Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 31, 2016 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | TiVo Corporation | |
Entity Central Index Key | 1,675,820 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 119,556,458 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 382,616 | $ 101,675 |
Short-term marketable securities | 121,221 | 107,879 |
Accounts receivable, net | 145,730 | 87,128 |
Inventory | 14,199 | 456 |
Prepaid expenses and other current assets | 40,917 | 13,735 |
Total current assets | 704,683 | 310,873 |
Long-term marketable securities | 115,934 | 114,715 |
Property and equipment, net | 43,514 | 34,984 |
Intangible assets, net | 849,531 | 386,742 |
Goodwill | 1,808,623 | 1,343,652 |
Other long-term assets | 12,191 | 8,330 |
Total assets | 3,534,476 | 2,199,296 |
Current liabilities: | ||
Accounts payable and accrued expenses | 234,714 | 74,113 |
Deferred revenue | 45,287 | 12,106 |
Current portion of long-term debt | 237,000 | 7,000 |
Total current liabilities | 517,001 | 93,219 |
Taxes payable, less current portion | 7,055 | 5,332 |
Deferred revenue, less current portion | 41,732 | 9,414 |
Long-term debt, less current portion | 965,733 | 960,156 |
Deferred tax liabilities, net | 71,560 | 66,116 |
Other long-term liabilities | 49,453 | 34,494 |
Total liabilities | 1,652,534 | 1,168,731 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, $0.001 par value, 250,000 shares authorized; 119,891 shares issued and 119,659 shares outstanding as of September 30, 2016; and 131,052 shares issued and 82,647 shares outstanding as of December 31, 2015 | 120 | 131 |
Treasury stock, 232 shares and 48,405 shares as of September 30, 2016 and December 31, 2015, respectively, at cost | (4,944) | (1,163,533) |
Additional paid-in capital | 3,254,634 | 2,419,921 |
Accumulated other comprehensive loss | (3,374) | (6,503) |
Accumulated deficit | (1,364,494) | (219,451) |
Total stockholders’ equity | 1,881,942 | 1,030,565 |
Total liabilities and stockholders’ equity | $ 3,534,476 | $ 2,199,296 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 250,000,000 | 250,000,000 |
Common Stock, shares issued | 119,891,000 | 131,052,000 |
Common Stock, shares outstanding | 119,659,000 | 82,647,000 |
Treasury Stock, shares | (232,000) | (48,405,000) |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues, net: | ||||
Licensing, services and software | $ 148,509 | $ 114,759 | $ 390,998 | $ 376,312 |
Hardware | 4,612 | 123 | 5,752 | 415 |
Total Revenues, net | 153,121 | 114,882 | 396,750 | 376,727 |
Costs and expenses: | ||||
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets | 31,661 | 24,492 | 78,651 | 78,134 |
Cost of hardware revenues, excluding depreciation and amortization of intangible assets | 4,560 | 116 | 5,072 | 273 |
Research and development | 30,951 | 22,976 | 77,804 | 75,246 |
Selling, general and administrative | 54,126 | 33,117 | 132,771 | 113,843 |
Depreciation | 4,622 | 4,280 | 13,181 | 13,098 |
Amortization of intangible assets | 24,925 | 19,189 | 63,087 | 57,789 |
Restructuring and asset impairment charges | 22,311 | 218 | 24,644 | 1,757 |
Total costs and expenses | 173,156 | 104,388 | 395,210 | 340,140 |
Operating (loss) income from continuing operations | (20,035) | 10,494 | 1,540 | 36,587 |
Interest expense | (11,021) | (11,348) | (32,411) | (35,421) |
Interest income and other, net | 353 | 586 | 322 | 1,089 |
Income (loss) on interest rate swaps | 1,697 | (11,787) | (16,897) | (17,106) |
Loss on debt extinguishment | 0 | (2,695) | 0 | (2,815) |
Loss from continuing operations before income taxes | (29,006) | (14,750) | (47,446) | (17,666) |
Income tax (benefit) expense | (83,445) | 3,708 | (74,825) | 12,924 |
Income (loss) from continuing operations, net of tax | 54,439 | (18,458) | 27,379 | (30,590) |
Loss from discontinued operations, net of tax | (4,517) | 0 | (4,517) | 0 |
Net income (loss) | $ 49,922 | $ (18,458) | $ 22,862 | $ (30,590) |
Basic earnings (loss) per share: | ||||
Continuing operations (in dollars per share) | $ 0.60 | $ (0.22) | $ 0.32 | $ (0.36) |
Discontinued operations (in dollars per share) | (0.05) | 0 | (0.05) | 0 |
Basic earnings (loss) per share (in dollars per share) | $ 0.55 | $ (0.22) | $ 0.27 | $ (0.36) |
Weighted average shares used in computing basic per share amounts (in shares) | 91,131 | 82,404 | 84,895 | 85,297 |
Diluted earnings (loss) per share: | ||||
Continuing operations (in dollars per share) | $ 0.59 | $ (0.22) | $ 0.32 | $ (0.36) |
Discontinued operations (in dollars per share) | (0.05) | 0 | (0.05) | 0 |
Diluted earnings (loss) per share (in dollars per share) | $ 0.54 | $ (0.22) | $ 0.27 | $ (0.36) |
Weighted average shares used in computing diluted per share amounts (in shares) | 92,144 | 82,404 | 85,858 | 85,297 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 49,922 | $ (18,458) | $ 22,862 | $ (30,590) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment | 452 | 288 | 2,636 | (230) |
Unrealized (losses) gains on marketable securities | (282) | (20) | 493 | (66) |
Other comprehensive income (loss), net of tax | 170 | 268 | 3,129 | (296) |
Comprehensive income (loss) | $ 50,092 | $ (18,190) | $ 25,991 | $ (30,886) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 22,862 | $ (30,590) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Loss from discontinued operations, net of tax | 4,517 | 0 |
Depreciation | 13,181 | 13,098 |
Amortization of intangible assets | 63,087 | 57,789 |
Amortization of convertible note discount and note issuance costs | 10,468 | 10,462 |
Restructuring and asset impairment charges | 24,644 | 1,757 |
Change in fair value of interest rate swaps | 9,716 | 14,055 |
Loss on debt extinguishment | 0 | 2,815 |
Equity-based compensation | 32,031 | 31,044 |
Deferred income taxes | (87,512) | 3,676 |
Other operating, net | 1,548 | 2,425 |
Changes in operating assets and liabilities (net of acquisitions): | ||
Accounts receivable | (9,798) | 16,429 |
Inventory | 1,260 | 0 |
Prepaid expenses and other current assets and other long-term assets | (10,737) | (2,230) |
Accounts payable and accrued expenses and other long-term liabilities | 2,663 | (16,652) |
Accrued income taxes | (1,827) | 153 |
Deferred revenue | 2,071 | (3,193) |
Net cash provided by operating activities of continuing operations | 78,174 | 101,038 |
Net cash used in operating activities of discontinued operations | 0 | (199) |
Net cash provided by operating activities | 78,174 | 100,839 |
Cash flows provided by investing activities: | ||
Payments for purchase of short- and long-term marketable securities | (132,159) | (169,986) |
Proceeds from sales or maturities of short- and long-term marketable securities | 183,992 | 258,430 |
Cash acquired in TiVo Acquisition, net of cash paid | 166,312 | 0 |
Payments for purchase of property and equipment | (15,810) | (8,345) |
Payments for purchase of patents | (2,500) | 0 |
Other investing, net | (48) | 3 |
Net cash provided by investing activities | 199,787 | 80,102 |
Cash flows used in financing activities: | ||
Proceeds from revolving credit facility | 0 | 100,000 |
Payments on revolving credit facility | 0 | (100,000) |
Proceeds from issuance of long-term debt, net of issuance costs | 0 | 335,616 |
Principal payments on long-term debt | (5,250) | (421,240) |
(Payments) proceeds from (purchase) sale of warrants | (2,923) | 31,326 |
Proceeds (payments) for (sale) purchase of call options | 5,706 | (64,825) |
Payments for deferred holdback and contingent consideration | (750) | (5,140) |
Payments for purchase of treasury stock | 0 | (154,519) |
Payments for withholding taxes related to net settlement of restricted stock units | (9,365) | 0 |
Proceeds from exercise of options and employee stock purchase plan | 13,964 | 8,767 |
Net cash provided by (used in) financing activities | 1,382 | (270,015) |
Effect of exchange rate changes on cash and cash equivalents | 1,598 | (317) |
Net increase (decrease) in cash and cash equivalents | 280,941 | (89,391) |
Cash and cash equivalents at beginning of period | 101,675 | 154,568 |
Cash and cash equivalents at end of period | $ 382,616 | $ 65,177 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Description of Business On April 28, 2016 , Rovi Corporation (" Rovi ") and TiVo Inc. (renamed TiVo Solutions Inc. (" TiVo Solutions ")) entered into an Agreement and Plan of Merger (the “Merger Agreement”) for Rovi to acquire TiVo Solutions in a cash and stock transaction (the " TiVo Acquisition "). Following consummation of the TiVo Acquisition on September 7, 2016 (the " TiVo Acquisition Date "), TiVo Corporation (the "Company"), a Delaware corporation founded in April 2016 under the name “Titan Technologies Corporation” and then a wholly-owned subsidiary of Rovi , owns both Rovi and TiVo Solutions . The common stocks of Rovi and TiVo Solutions were de-registered after completion of the TiVo Acquisition . The Company provides innovative products and licensable technologies that enable the world’s leading media and entertainment companies to deliver the ultimate entertainment experience and improve how people find content across a changing media landscape. The Company's broad set of content discovery solutions includes interactive program guides (“IPGs”), the TiVo Service and TiVo-enabled digital video recorders ("DVRs"), natural language conversational voice and text search and recommendation services and our extensive database of "Metadata" (i.e., descriptive information, promotional images or other content that describes or relates to television shows, videos, movies, music, books, games or other entertainment content). The Company also offers advertising and a portfolio of data and analytics products including advertising and programming promotion optimization that enable audience targeting in traditional pay TV advertising along with subscriber and operator analytic and insight products that service providers can use to unlock the usage patterns and behaviors of pay TV subscribers. The Company's solutions are deployed globally in the cable, satellite, consumer electronics, entertainment, media and online distribution markets. Basis of Presentation and Principles of Consolidation Rovi is the predecessor registrant to TiVo Corporation and therefore, for periods prior to September 7, 2016 , the Condensed Consolidated Financial Statements reflect the financial position and results of operations and cash flows of Rovi . As used herein, the “Company” refers to Rovi when referring to periods prior to September 7, 2016 and to TiVo Corporation when referring to periods subsequent to September 7, 2016 . The Company’s results of operations include the operations of TiVo Solutions after September 7, 2016 . See Note 2 for additional information on the TiVo Acquisition . The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been condensed or omitted in accordance with such rules and regulations. However, the Company believes the disclosures made are adequate to make the information presented herein not misleading. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements reflect all adjustments, consisting only of normal recurring adjustments, which in the opinion of management, are considered necessary to present fairly the results for the periods presented. The information contained in this Quarterly Report on Form 10-Q should be read in conjunction with the audited financial statements and notes thereto and other disclosures contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 . The Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Cash Flows for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2016 , for any future year, or for any other future interim period. The accompanying Condensed Consolidated Financial Statements include the accounts of TiVo Corporation and subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary after the elimination of intercompany accounts and transactions. Certain prior year amounts have been reclassified to conform to the current year presentation. Use of Estimates The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and related disclosures at the date of the financial statements and the reported results of operations for the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, long-lived asset impairment, including goodwill and intangible assets, equity-based compensation and income taxes. Actual results may differ from those estimates. Concentrations of Risk The percent of revenue derived from customers, and concentrations of customers, representing more than 10% of revenue were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 AT&T Inc. ("AT&T") 13 % 14 % 13 % 13 % Charter Communications Inc. ("Charter") (1) 11 % 11 % 10 % (1) Customer represented less than 10% of revenue. Substantially all of the Company's revenue from AT&T and a significant portion of the Company's revenue from Charter is reported in the Intellectual Property Licensing segment. Customers representing more than 10% of Accounts receivable, net were as follows. September 30, 2016 December 31, 2015 AT&T 15 % 22 % Virgin Media Inc. 14 % (1) DISH Network L.L.C. ("DISH") 12 % (1) (1) Customer represented less than 10% of Accounts receivable, net . The TiVo service is enabled through the use of a DVR manufactured by a third-party contract manufacturer. The Company also relies on third-parties with whom it outsources supply-chain activities related to inventory warehousing, order fulfillment, distribution, and other direct sales logistics. The Company cannot be sure that these parties will perform their obligations as expected or that any revenue, cost savings, or other benefits will be derived from the efforts of these parties. If any of these parties breaches or terminates their agreement with the Company or otherwise fails to perform their obligations in a timely manner, the Company may be delayed or prevented from commercializing its products and services. The Company does not have a long-term written supply agreement with Broadcom Corporation, the sole supplier of the system controller for its DVR. In instances where a supply agreement does not exist and suppliers fail to perform their obligations, the Company may be unable to find alternative suppliers or deliver its products and services to its customers on time if at all. Significant Accounting Policy Changes The accounting policies described below are those that are either initially applied or materially modified subsequent to the policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2015 . These updates primarily result from the TiVo Acquisition . Cash and cash equivalents Highly liquid investments with original maturities at the date of acquisition of three months or less are considered to be cash equivalents. The majority of payments due from banks for third-party credit card, debit card, and electronic benefit transactions (EBT) process within 24-72 hours, except for transactions occurring on a Friday, which are generally processed the following Monday. All credit card, debit card and EBT transactions that process in less than three days are classified as cash and cash equivalents. Payments due from banks for these transactions presented in Cash and cash equivalents was $0.8 million as of September 30, 2016 . Inventory Inventories consist primarily of finished DVR units and accessories and are stated at the lower of cost or market. Cost is computed using standard cost, which approximates actual cost on a first-in, first-out basis. Adjustments to reduce the cost of inventory to the lower of cost or market are made, if required, for estimated excess or obsolescence, which includes a review of, among other factors, demand requirements and market conditions. Revenue Recognition Patent Sales During 2016, the Company expanded its business strategy of monetizing its intellectual property to include the sale of select patent assets. As patent sales executed under this strategy represent a component of the Company's ongoing major or central operations and activities of monetizing intellectual property, the related proceeds from patent sales are now recognized as revenue. Revenue from patent sales is recognized when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred and collectibility is reasonably assured. These requirements are generally fulfilled on closing of the patent sale transaction. Revenue for the three and nine months ended September 30, 2016 includes $0.3 million and $0.8 million , respectively, related to patent sales. Sources of Revenue of TiVo Solutions The Company's TiVo Solutions subsidiary generates service revenues, hardware revenues (in some instances), and technology revenues by providing the traditional TiVo service through agreements with satellite and cable television service providers and broadcasters. Through our subsidiary, Cubiware Sp. Z.o.o. ("Cubiware"), TiVo Solutions offers a solution for Pay-TV Operators in developing and emerging markets around the world. Through our subsidiary Digitalsmiths Corporation, we provide a cloud-based search and recommendation services for the Pay-TV industry. TiVo Solutions generates revenue through both recurring and upfront service fees through sale of TiVo service subscriptions to consumers and through the sale of TiVo devices by third-party retailers and through the online store at TiVo.com. Through our subsidiary TiVo Research and Analytics, Inc., we also generate revenues through the sale of cross-platform audience research data by providing data analytics solutions for the television industry. TiVo-Owned Business: TiVo-enabled DVRs and TiVo service 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 the product for one upfront payment (prepaid program). In the case of the monthly program, after the initial committed subscription term, the customers have various pricing options at which they can renew the subscription. Vendor-specific objective evidence ("VSOE") of selling price for the subscription services is established based on standalone sales of the service and varies by service period. The Company is not able to obtain VSOE for the DVR element due to infrequent sales of standalone DVRs to consumers. The best-estimate of selling price ("BESP") of the DVR is established based on the price at which the Company would sell the DVR without any service commitment from the customer. Under these bundled programs, revenue is allocated between hardware revenue for the DVR and service revenue for the subscription on a relative selling price basis, with the DVR revenue recognized upon delivery, up to an amount not contingent on future service delivery, and the subscription revenue is recognized over the term of the service. Subscription revenues from product lifetime subscriptions are recognized ratably over the Company's estimate of the useful life of a TiVo-enabled DVR associated with the subscription. The estimates of expected lives are dependent on assumptions with regard to future churn of product lifetime subscriptions. The Company continuously monitors the useful life of a TiVo-enabled DVR and the impact of the difference between actual churn and forecasted churn rates. If actual results are not consistent with the Company's current assumptions, including a higher churn rate for product lifetime subscriptions due to the incompatibility of TiVo's standard definition units with high definition programming and increased competition, the Company may revise the estimated life of the units which could result in the recognition of revenue over a longer or shorter period. The Company recognizes product lifetime subscription revenues over an estimated product life of 66 months. End users have the right to cancel their subscriptions to the TiVo service within 30 days of subscription activation for a full refund. TiVo establishes allowances for expected subscription cancellations. TiVo Arrangements with Multiple System Operators ("MSOs") The Company has two different types of arrangements with MSOs that include technology deployment and engineering services. The Company's arrangements with MSOs typically include software customization and set up services, limited training, post contract support ("PCS"), TiVo-enabled DVRs, non-DVR set-top boxes ("STBs"), and TiVo service. In instances where TiVo hosts the TiVo service, the Company recognizes revenue under the general revenue recognition guidance. The Company determines whether evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collection is reasonably assured. Revenue recognition is deferred until such time as all of the criteria are satisfied. Elements in such arrangements usually include DVRs, non-DVR STBs, TiVo service hosting, associated maintenance, and support and training. Non-refundable payments received for customization and set up services are deferred and recognized as revenue over the period the services are expected to be provided (the longer of the contractual term or customer relationship period) as the upfront services do not have standalone value. The related cost of such services is capitalized to the extent it is deemed recoverable and amortized to cost of revenues over the same period as the related revenue. The Company has 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 determined considering the size of the MSO and expected volume of deployment, market conditions, competitive landscape, internal costs and total gross margin objectives. Total arrangement consideration (other than fees for customization and set up services which are allocated to the ongoing hosting services) is allocated among individual elements on a relative basis. In arrangements where the Company does not host the TiVo service and that include engineering services that are essential to the functionality of the licensed technology or involve significant customization or modification of the software, the Company recognizes revenue under industry specific software revenue recognition guidance. Under the software revenue recognition guidance, such arrangements are accounted for using the percentage-of-completion method or the completed-contract method. The percentage-of-completion method is used if the Company believes it is able to make reasonably dependable estimates of the extent of progress toward completion and the arrangement as a whole is reasonably expected to be profitable. The Company measures progress toward completion using an input method based on the ratio of costs incurred, principally labor, to date to total estimated costs of the project. These estimates are reassessed during the term of the arrangement, and revisions to estimates are recognized on a cumulative catch-up basis when the changed conditions become known. In some cases, it may not be possible to separate the various elements within the arrangement due to a lack of VSOE of selling prices for undelivered elements in the contract or because of the lack of reasonably dependable estimates of total costs or development costs exceed development revenues but the Company is reasonably assured that no loss will be incurred under the arrangement. Accordingly, the Company applies the following: • Where no VSOE exists for undeliverable elements, revenue is recognized at zero margin up to the amount billable until the Company has established VSOE for the undelivered elements or the Company has delivered all of the elements. • Where there is a lack of reasonably dependable estimates, revenue is recognized at zero margin up to the amount billable until the Company has resolved the estimation uncertainty, after which the Company recognizes margin under the percentage of completion method. • If the Company cannot be reasonably assured that no loss will be incurred under the arrangement, the Company will account for the arrangement under the completed contract method, which results in a full deferral of the revenue and costs until the project is complete. Provisions for losses are recorded when estimates indicate that a loss will be incurred on the arrangement. Where development costs exceed billable development revenues provided that the Company is reasonably assured that no loss will be incurred under the arrangement, the Company recognizes revenues and costs based at zero margin, which results in the recognition of equal amounts of revenues and costs until the engineering professional services are complete. Development costs incurred in excess of revenues recognized are deferred up to the amount deemed recoverable. Thereafter, as the Company recognizes revenue from the MSO arrangement for services, an equal amount of deferred development costs is recognized until all deferred development costs are recovered. Afterwards, any additional MSO service revenue is recognized as service revenue. Software Revenues Software revenues represent revenues from licenses of Cubiware software and amounts allocated to software elements in multiple element arrangements. These license arrangements are with operators or resellers who integrate our software in set top boxes manufactured by the operators or resellers. Revenues are generally recognized on shipment of the set top boxes in which the software is integrated, provided that all fees are fixed or determinable, evidence of an arrangement exists, and collectibility is reasonably assured. Hardware Revenues Hardware revenues represent revenues from standalone hardware sales and amounts allocated to hardware elements in multiple element arrangements. Revenues are recognized upon product shipment to the customers or receipt of the products by the customer, depending on the shipping terms, provided that all fees are fixed or determinable, evidence of an arrangement exists, and collectibility is reasonably assured. End users have the right to return their product within 30 days of the purchase. The Company establishes allowances for expected product and service returns and these allowances are recorded as a direct reduction of revenues and accounts receivable. Certain payments to retailers and distributors such as market development funds and revenue share are recorded as a reduction of hardware revenues rather than as a sales and marketing expense. The Company's policy for revenue share payments is to reduce revenue when these payments are incurred and fixed or determinable. The Company reduces revenue at the later of the date at which the related hardware revenue is recognized or the date at which the market development program is offered. Warranty Expense The Company accrues for the expected material and labor costs required 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 or repair the customers’ product returns under warranty. Recent Accounting Pronouncements Standards Recently Adopted In April 2015, the Financial Accounting Standards ("FASB") issued guidance to help entities evaluate whether fees paid in a cloud computing arrangement include a software license. Pursuant to this guidance, when a cloud computing arrangement includes a software license, the customer accounts for the software license element of the arrangement consistent with the acquisition of other software licenses. When a cloud computing arrangement does not include a software license element, the customer accounts for the arrangement as a service contract. The prospective application of this guidance on January 1, 2016 did not have a material effect on the Condensed Consolidated Financial Statements . Standards Pending Adoption In August 2016, the FASB issued clarifying guidance on the presentation of eight specific cash flow issues for which previous guidance was either unclear or was not specific. The clarified guidance is effective for the Company in the first quarter of 2018, with early application permitted, and is required to be applied on a retrospective basis. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In June 2016, the FASB issued updated guidance that requires entities to use a current expected credit loss model to measure credit-related impairments for financial instruments held at amortized cost. The current expected credit loss model is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect collectibility. Current expected credit losses, and subsequent adjustments, represent an estimate of lifetime expected credit losses that are recorded as an allowance deducted from the amortized cost basis of the financial instrument. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments for credit-related losses through an allowance and eliminating the length of time a security has been in an unrealized loss position as a consideration in the determination of whether a credit loss exists. The guidance is effective for the Company in the first quarter of 2020, and is effective using a modified retrospective approach for application of the current expected credit loss model to financial instruments and a prospective approach for credit losses on available-for-sale debt securities. Early application is permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In March 2016, the FASB simplified certain areas of accounting for stock-based compensation, including accounting for the income tax consequences of stock-based compensation, determining the classification of awards as either equity or liabilities, classifying certain items within the statement of cash flows and introducing an accounting policy election to account for forfeitures of nonvested awards as they occur. The simplified guidance is effective for the Company in the first quarter of 2017. Depending on the area simplified, the guidance is effective either prospectively, retrospectively or using a modified retrospective approach. Early application is permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In March 2016, the FASB clarified the requirements for assessing whether contingent options that can accelerate the payment of principal on debt instruments require bifurcation as an embedded derivative. The amendments require a contingent option embedded in a debt instrument to be evaluated for possible separate accounting as a derivative instrument without regard to the nature of the exercise contingency. The clarified guidance is effective for the Company in the first quarter of 2017 using a modified retrospective approach with early application permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In February 2016, the FASB issued a new accounting standard for leases. The new standard generally requires the recognition of financing and operating lease liabilities and corresponding right-of-use assets on the balance sheet. For financing leases, a lessee recognizes amortization of the right-of-use asset as an operating expense over the lease term separately from interest on the lease liability. For operating leases, a lessee recognizes its total lease expense as an operating expense over the lease term. The amendments are effective for the Company in the first quarter of 2019 using a modified retrospective approach with early application permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements and expects that its existing operating lease commitments will be recognized as operating lease liabilities and right-of-use assets. In January 2016, the FASB amended certain aspects of the recognition and measurement guidance for financial assets and liabilities. The amendments are effective for the Company in the first quarter of 2018 with the effect of adoption recognized as a cumulative-effect adjustment to beginning retained earnings in 2018. Early application is not permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In July 2015, the FASB changed the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value for entities that do not use the last-in, first-out ("LIFO") or retail inventory method. The changes also eliminate the requirement to consider replacement cost or net realizable value less an approximately normal profit margin when measuring inventory for entities that do not use the LIFO or retail inventory method. The changes are effective for the Company in the first quarter of 2017 using a prospective transition approach, with early adoption permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In May 2014, the FASB issued an amended accounting standard for revenue recognition. The amendments address how revenue is recognized in order to improve comparability between the financial statements of companies applying U.S. GAAP and International Financial Reporting Standards. The core principle of the amended standard is for an entity to recognize revenue to depict the transfer of promised goods or services to customers in amounts that reflect the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments are effective for the Company in the first quarter of 2018 and may be applied using a full retrospective or modified retrospective approach. Early application is permitted beginning in the Company's first quarter of 2017. The Company is evaluating the effect the amendments and transition alternatives will have on its Condensed Consolidated Financial Statements . |
TiVo Acquisition
TiVo Acquisition | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
TiVo Acquisition | TiVo Acquisition Acquisition Terms On September 7, 2016 , Rovi completed its acquisition of TiVo Solutions , a global leader in next-generation video technology and innovative cloud-based software-as-a-service solutions. At the TiVo Acquisition Date , each TiVo Solutions share of common stock outstanding (other than shares of TiVo Solutions common stock held by those TiVo Solutions stockholders who have properly demanded and not waived or withdrawn appraisal rights under Delaware law, as further discussed below) was converted into the right to receive $2.75 per share in cash and 0.3853 shares of TiVo Corporation common stock. The TiVo Acquisition created a new company which is a global leader in entertainment technology and audience insights. On the TiVo Acquisition Date , (i) each issued and outstanding share of Rovi Common Stock was converted into one fully paid and non-assessable share of TiVo Corporation Common Stock and (ii) each Rovi Stock Option, Rovi Restricted Stock Award and Rovi RSU (each as defined in the Merger Agreement) was assumed by TiVo Corporation and automatically converted into a TiVo Corporation Stock Option, TiVo Corporation Restricted Stock Award and TiVo Corporation RSU (each as defined in the Merger Agreement), respectively, each on substantially the same terms and conditions as applied to such Rovi Stock Option, Rovi Restricted Stock Award and Rovi RSU. Further on the TiVo Acquisition Date , each issued and outstanding share of TiVo Solutions Common Stock (other than shares of TiVo Solutions common stock held by those TiVo Solutions stockholders who have properly demanded and not waived or withdrawn appraisal rights under Delaware law as further discussed below) automatically converted into a right to receive (x) 0.3853 (the “Exchange Ratio”) validly issued, fully paid and non-assessable shares of TiVo Corporation Common Stock and (y) $2.75 in cash. In addition, each TiVo Solutions Stock Option, TiVo Solutions Restricted Stock Award and TiVo Solutions RSU (each as defined in the Merger Agreement) that was outstanding and held by a continuing employee or consultant (and excluding non-employee directors of TiVo Solutions ) was assumed by TiVo Corporation and automatically converted into a TiVo Corporation Stock Option, TiVo Corporation Restricted Stock Award and TiVo Corporation RSU (each as defined in the Merger Agreement), respectively, each on substantially the same terms and conditions as applied to such TiVo Solutions Stock Option, TiVo Solutions Restricted Stock Award and TiVo Solutions RSU (but, taking into account any changes thereto provided for in the TiVo Stock Plans (as defined in the Merger Agreement) in any award agreement or in any such TiVo Solutions Stock Option, TiVo Solutions Restricted Stock Award or TiVo Solutions RSU, as applicable, by reason of the Merger Agreement or the transactions contemplated thereby), after applying an exchange ratio of 0.5186 . Holders of 9.9 million shares of TiVo Solutions common stock outstanding at the TiVo Acquisition Date did not vote to approve the TiVo Acquisition and asserted their appraisal rights under Delaware law with respect to such shares ("Dissenting Holders", and the shares held by such Dissenting Holders, the "Dissenting Shares"). The merger consideration for the Dissenting Shares is currently held in an account by the exchange agent in the TiVo Acquisition . The Dissenting Holders must decide whether or not to receive the consideration they are entitled to as a result of the merger within 60 days of the TiVo Acquisition Date . If the Dissenting Holders do not elect to receive the merger consideration, they will have until 120 days after the TiVo Acquisition Date to file a petition for appraisal in the Delaware Court of Chancery. Should the Court of Chancery reach a verdict on any such claim, the Dissenting Holders will be entitled to receive a cash payment in an amount equal to the fair value of their shares (as determined in accordance with the provisions of Delaware law) in lieu of the shares of TiVo Corporation which they would otherwise have been entitled to receive. The Dissenting Holders would also receive prejudgment interest on any appraisal award, which would be calculated at a rate of 5% above the Federal Reserve Discount Rate compounded quarterly. TiVo Solutions ' results of operations and cash flows have been included in the Condensed Consolidated Financial Statements for periods subsequent to September 7, 2016 , and TiVo Solutions ' assets and liabilities were recorded at their estimated fair values in the Condensed Consolidated Balance Sheets as of September 7, 2016 , with the excess of the purchase price over the estimated fair values being allocated to goodwill. Purchase Price The preliminary aggregate merger consideration was (in thousands): Aggregate cash consideration $ 269,990 Aggregate fair value of TiVo Corporation shares issued 751,385 Fair value of assumed TiVo Solutions employee stock-based awards allocated to consideration 22,640 Accrual for merger consideration 85,711 Total merger consideration $ 1,129,726 The cash portion of the merger consideration was funded with cash on hand of the combined company. The calculations above use a value for shares of TiVo Corporation common stock issued in the TiVo Acquisition based on a Rovi stock price of $22.42 per share at the close of trading on September 7, 2016 . In connection with the TiVo Acquisition , 33.5 million shares of TiVo Corporation common stock were issued to TiVo Solutions stockholders. In addition, as the Dissenting Holders have not decided whether or not to receive the consideration they are entitled to as a result of the TiVo Acquisition , $85.7 million of merger consideration was accrued at the TiVo Acquisition Date related to the Dissenting Holders. The accrual for merger consideration was calculated based on 9.9 million Dissenting Shares assuming a right to receive 0.3853 shares of TiVo Corporation common stock, or 3.8 million shares of TiVo Corporation common stock. The accrued merger consideration is presented in Accounts payable and accrued expenses on the Condensed Consolidated Balance Sheets . In addition, TiVo Corporation paid $2.75 per share in cash, or $27.3 million , to an account related to the cash portion of the merger consideration due to the Dissenting Shares on the TiVo Acquisition Date . A portion of the purchase price has been attributed to the substitution of TiVo Solutions stock-based awards outstanding as of TiVo Acquisition Date for corresponding TiVo Corporation stock-based awards. The fair value of TiVo Solutions ' stock-based awards assumed in connection with the TiVo Acquisition was allocated between pre-acquisition service and post-acquisition service based on the proportion of service rendered from the grant date to the TiVo Acquisition Date compared to the total vesting period. Share-based compensation allocated to pre-acquisition service was included as part of the merger consideration paid for TiVo Solutions . The fair value of TiVo Solutions ' restricted stock was estimated at the TiVo Acquisition Date using the closing price of Rovi 's common stock on the TiVo Acquisition Date . The fair value of TiVo Solutions ' stock options was estimated at the TiVo Acquisition Date using the Black-Scholes-Merton option-pricing formula, assuming a weighted-average expected volatility of 31.7% , a weighted-average expected term of nine months , a weighted-average risk-free interest rate of 0.5% and a weighted-average expected dividend yield of 0.0% . The fair value of TiVo Corporation 's stock options was estimated at the TiVo Acquisition Date using the Black-Scholes-Merton option-pricing formula, assuming a weighted-average expected volatility of 46.5% , a weighted-average expected term of nine months , a weighted-average risk-free interest rate of 0.5% and a weighted-average expected dividend yield of 0.0% . The fair value of TiVo Solutions ' performance-based awards was estimated at the TiVo Acquisition Date using a Monte-Carlo simulation, assuming a weighted-average expected volatility of 37.5% , a weighted-average expected term of 2.4 years , a weighted-average risk-free interest rate of 0.8% and an expected dividend yield of 0.0% . Purchase Price Allocation The Condensed Consolidated Financial Statements have been prepared using the acquisition method of accounting under U.S. GAAP with Rovi treated as the acquirer of TiVo Solutions for accounting purposes. Under the acquisition method of accounting, the purchase consideration delivered by TiVo Corporation to complete the acquisition was generally allocated to the assets acquired and liabilities assumed based on their fair value at the TiVo Acquisition Date . The purchase price allocation as of September 30, 2016 is preliminary. TiVo Corporation has made significant estimates and assumptions in determining the preliminary fair value of the assets acquired and liabilities assumed based on discussions with TiVo Solutions ’ management and TiVo Corporation ’s informed insights into the industries in which TiVo Solutions competes. To complete the allocation of purchase consideration to the assets acquired and liabilities assumed at their TiVo Acquisition Date fair value, certain procedures, such as completing accounting valuations and income tax returns and further discussion with TiVo Solutions ’ management, have to be performed. Accordingly, the purchase price allocation is subject to change based on further review. Adjustments to the preliminary purchase price allocation identified during the measurement period would be reported in the period the adjustment is identified, with the effect on earnings measured as if the accounting had been completed at the TiVo Acquisition Date . Final purchase accounting amounts recorded may differ materially from the preliminary fair value estimates presented in these Condensed Consolidated Financial Statements , and such differences could have a material impact on the accompanying Condensed Consolidated Financial Statements and TiVo Corporation ’s future results of operations and financial position. The final estimates of fair value are expected to be completed as soon as possible, but no later than one year from the TiVo Acquisition Date . The following table summarizes the preliminary purchase price allocation as of September 30, 2016 (in thousands): Cash, cash equivalents and marketable securities $ 503,408 Accounts receivable 48,766 Inventory 15,003 Prepaid expenses and other current assets and other long-term assets 25,976 Property and equipment 10,370 Intangible assets: Developed technology and patents 154,000 Existing contracts and customer relationships 355,000 Trademarks / Tradenames 14,000 Goodwill 464,111 Accounts payable and accrued expenses and other long-term liabilities (74,736 ) Deferred revenue (63,428 ) Current portion of long-term debt (230,000 ) Deferred tax liabilities, net (92,744 ) Total merger consideration $ 1,129,726 Valuation Techniques The fair values of assets acquired and liabilities assumed were preliminarily determined using the income, cost and market approaches. Generally, no fair value adjustments were reflected for current assets and current liabilities as carrying value was estimated to approximate fair value because of the short-term nature of the items. The fair value of marketable securities acquired was estimated using observable market-corroborated inputs, such as quoted prices in active markets for similar assets or independent pricing vendors, obtained from a third party pricing service and would be presented in Level 2 of the fair value hierarchy, which is described in Note 5. The fair value of intangible assets was primarily based on third-party valuations using assumptions developed by management and other information compiled by management including, but not limited to, discounted future expected cash flows. Discounted future expected cash flows are based on significant unobservable inputs and, as a result, the intangible assets acquired would be presented in Level 3 of the fair value hierarchy. As part of the acquisition, TiVo Corporation assumed TiVo Solutions ' 2% Convertible Senior Notes due October 2021 (the " 2021 Convertible Notes "). The fair value of the 2021 Convertible Notes assumed in the TiVo Acquisition was measured based on quoted market prices and the 2021 Convertible Notes would be classified in Level 2 of the fair value hierarchy. As the 2021 Convertible Notes are subject to repurchase following the acquisition of TiVo Solutions , fair value approximated par and no debt premium or discount was recorded. See Note 8 for additional information. The fair value of contingent consideration assumed related to legacy TiVo Solutions acquisitions was estimated utilizing a probability-weighted discounted cash flow analysis based on the terms of the underlying purchase agreement and the contingent consideration would be classified in Level 3 of the fair value hierarchy. The significant unobservable inputs used in calculating the fair value of contingent consideration include financial performance scenarios, the probability of achieving those scenarios and the discount rate. An adjustment was recorded for the deferred tax impact of purchase accounting adjustments primarily related to intangible assets and the 2021 Convertible Notes . The incremental deferred tax liabilities were calculated primarily based on the tax effect of the step-up in book basis of net assets of TiVo Solutions excluding the amount attributable to nondeductible goodwill. The excess of the consideration transferred over the fair value of assets acquired and liabilities assumed was recognized as goodwill. The goodwill is generated from operational synergies and cost savings TiVo Corporation expects to achieve from the combined operations, as well as the expected benefits from future technologies that do not meet the definition of an identifiable intangible asset and TiVo Solutions ' knowledgeable and experienced workforce. See Note 6 for the allocation of goodwill to the reportable segments. None of the goodwill is expected to be deductible for tax purposes. During the three and nine months ended September 30, 2016 , TiVo Solutions contributed $21.6 million of net revenue and $31.0 million of Operating loss , respectively, to the results of TiVo Corporation . Unaudited Pro Forma Information The following unaudited pro forma condensed combined financial information (in thousands, except per share amounts) has been adjusted to give effect to the TiVo Acquisition as if it were consummated on January 1, 2015 (the beginning of the comparable prior reporting period). The unaudited pro forma condensed combined financial information is presented for informational purposes only. The unaudited pro forma condensed combined financial information is not intended to represent or be indicative of the results of operations that would have been reported had the TiVo Acquisition occurred on January 1, 2015 and should not be taken as representative of future results of operations of the combined company. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Revenues, net: $ 208,690 $ 215,281 $ 616,137 $ 655,029 Income (loss) from continuing operations, net of tax $ (35,380 ) $ (45,395 ) $ (120,633 ) $ (123,081 ) Basic income (loss) per share from continuing operations $ (0.28 ) $ (0.39 ) $ (1.02 ) $ (1.03 ) Diluted income (loss) per share from continuing operations $ (0.28 ) $ (0.39 ) $ (1.02 ) $ (1.03 ) The unaudited pro forma condensed combined financial information includes material, nonrecurring pro forma adjustments directly attributable to the TiVo Acquisition primarily related to a reduction in revenues and costs to adjust TiVo Solutions ' historical deferred revenue amortization and deferred technology cost amortization to fair value, the elimination of intercompany revenue as TiVo Solutions purchases products from Rovi , adjustments to the amortization of intangible assets, and adjustments for direct and incremental acquisition-related costs reflected in the historical financial statements. The unaudited pro forma condensed combined financial information does not include any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred in integrating the companies. |
Financial Statement Details
Financial Statement Details | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Financial Statement Details | Financial Statement Details Accounts receivable, net (in thousands): September 30, 2016 December 31, 2015 Accounts receivable, gross $ 147,388 $ 88,735 Less: Allowance for doubtful accounts (1,658 ) (1,607 ) Accounts receivable, net $ 145,730 $ 87,128 Inventory (in thousands): September 30, 2016 December 31, 2015 Raw materials $ 2,165 $ — Finished goods 12,034 456 Inventory $ 14,199 $ 456 Property and equipment, net (in thousands): September 30, 2016 December 31, 2015 Computer software and equipment $ 130,075 $ 133,631 Leasehold improvements 25,143 21,578 Furniture and fixtures 7,513 7,676 Property and equipment, gross 162,731 162,885 Less: Accumulated depreciation and amortization (119,217 ) (127,901 ) Property and equipment, net $ 43,514 $ 34,984 Accounts payable and accrued expenses (in thousands): September 30, 2016 December 31, 2015 Accounts payable $ 32,739 $ 9,013 Accrued compensation and benefits 43,387 27,056 Accrual for merger consideration 85,711 — Other accrued liabilities 72,877 38,044 Accounts payable and accrued expenses $ 234,714 $ 74,113 Supplemental Cash Flow Information (in thousands): Nine Months Ended September 30, 2016 2015 Significant noncash transactions Fair value of shares issued in connection with TiVo Acquisition $ 751,385 $ — |
Investments
Investments | 9 Months Ended |
Sep. 30, 2016 | |
Investments [Abstract] | |
Investments | Investments The amortized cost and fair value of cash, cash equivalents and marketable securities by significant investment category were as follows (in thousands): September 30, 2016 Amortized Cost Unrealized Unrealized Fair Value Cash $ 162,282 $ — $ — $ 162,282 Cash equivalents - Money market funds 220,334 — — 220,334 Cash and cash equivalents $ 382,616 $ — $ — $ 382,616 Auction rate securities $ 10,800 $ — $ (432 ) $ 10,368 Corporate debt securities 104,367 57 (88 ) 104,336 Foreign government obligations 6,648 — (3 ) 6,645 U.S. Treasuries / Agencies 115,865 46 (105 ) 115,806 Marketable securities $ 237,680 $ 103 $ (628 ) $ 237,155 Cash, cash equivalents and marketable securities $ 619,771 December 31, 2015 Amortized Cost Unrealized Unrealized Fair Value Cash $ 56,745 $ — $ — $ 56,745 Cash equivalents - Money market funds 44,930 — — 44,930 Cash and cash equivalents $ 101,675 $ — $ — $ 101,675 Auction rate securities $ 10,800 $ — $ (540 ) $ 10,260 Corporate debt securities 98,997 — (327 ) 98,670 Foreign government obligations 11,878 — (56 ) 11,822 U.S. Treasuries / Agencies 102,120 5 (283 ) 101,842 Marketable securities $ 223,795 $ 5 $ (1,206 ) $ 222,594 Cash, cash equivalents and marketable securities $ 324,269 The Company attributes unrealized losses on its auction rate securities to liquidity issues rather than credit issues. The Company’s auction rate securities are comprised solely of AAA-rated federally insured student loans. The Company continues to earn interest on its auction rate securities and has the ability and intent to hold these securities until they recover their amortized cost. As of September 30, 2016 , the amortized cost and fair value of marketable securities, by contractual maturity, were as follows (in thousands): Amortized Cost Fair Value Due in less than 1 year $ 121,227 $ 121,221 Due in 1-2 years 105,653 105,566 Due in more than 2 years 10,800 10,368 Total $ 237,680 $ 237,155 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair Value Hierarchy The Company uses valuation techniques that are based on observable and unobservable inputs to measure fair value. Observable inputs are developed using publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Fair value measurements are classified in a hierarchy that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement in its entirety: 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. Assets and liabilities reported at fair value on a recurring basis in the Condensed Consolidated Balance Sheets were classified in the fair value hierarchy as follows (in thousands): September 30, 2016 Total Quoted Prices in Significant Other Significant Assets Cash and cash equivalents Money market funds $ 220,334 $ 220,334 $ — $ — Short-term marketable securities Corporate debt securities 72,084 — 72,084 — Foreign government obligations 6,645 — 6,645 — U.S. Treasuries / Agencies 42,492 — 42,492 — Long-term marketable securities Auction rate securities 10,368 — — 10,368 Corporate debt securities 32,252 — 32,252 — U.S. Treasuries / Agencies 73,314 — 73,314 — Total Assets $ 457,489 $ 220,334 $ 226,787 $ 10,368 Liabilities Accounts payable and accrued expenses Cubiware contingent consideration $ (4,091 ) $ — $ — $ (4,091 ) Interest rate swaps (1,483 ) — (1,483 ) — Other long-term liabilities Cubiware contingent consideration (3,518 ) — — (3,518 ) Interest rate swaps (33,986 ) — (33,986 ) — Total Liabilities $ (43,078 ) $ — $ (35,469 ) $ (7,609 ) December 31, 2015 Total Quoted Prices in Significant Other Significant Assets Cash and cash equivalents Money market funds $ 44,930 $ 44,930 $ — $ — Short-term marketable securities Corporate debt securities 43,876 — 43,876 — Foreign government obligations 7,827 — 7,827 — U.S. Treasuries / Agencies 56,176 — 56,176 — Long-term marketable securities Auction rate securities 10,260 — — 10,260 Corporate debt securities 54,794 — 54,794 — Foreign government obligations 3,995 — 3,995 — U.S. Treasuries / Agencies 45,666 — 45,666 — Total Assets $ 267,524 $ 44,930 $ 212,334 $ 10,260 Liabilities Accounts payable and accrued expenses Interest rate swaps $ (195 ) $ — $ (195 ) $ — Other long-term liabilities Interest rate swaps (25,557 ) — (25,557 ) — Total Liabilities $ (25,752 ) $ — $ (25,752 ) $ — The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period. For the three and nine months ended September 30, 2016 and 2015 , there were no transfers between levels of the fair value hierarchy. Changes in the fair value of assets and liabilities classified in Level 3 of the fair value hierarchy were as follows (in thousands): Three Months Ended September 30, 2016 2015 Auction rate securities Cubiware contingent consideration Auction rate securities Veveo contingent consideration Balance at beginning of period $ 10,260 $ — $ 10,584 $ (860 ) Assumed in TiVo Acquisition — (7,542 ) — — Gain (loss) included in earnings — (67 ) — 860 Unrealized gains (losses) included in other comprehensive (loss) income 108 — (108 ) — Balance at end of period $ 10,368 $ (7,609 ) $ 10,476 $ — Nine Months Ended September 30, 2016 2015 Auction rate securities Cubiware contingent consideration Auction rate securities IntegralReach contingent consideration Veveo contingent consideration Balance at beginning of period $ 10,260 $ — $ 10,638 $ (3,000 ) $ (3,000 ) Settlements — — — 3,000 2,140 Assumed in TiVo Acquisition — (7,542 ) — — — Gain (loss) included in earnings — (67 ) — — 860 Unrealized gains (losses) included in other comprehensive (loss) income 108 — (162 ) — — Balance at end of period $ 10,368 $ (7,609 ) $ 10,476 $ — $ — Amounts related to Veveo contingent consideration are included in Selling, general and administrative expense as the adjustments relate to changes in estimate and amounts related to Cubiware contingent consideration are included in Interest expense as the adjustments relate to accretion of the liability to future value. Valuation Techniques The fair value of marketable securities, other than auction rate securities, is estimated using observable market-corroborated inputs, such as quoted prices in active markets for similar assets or independent pricing vendors, obtained from a third party pricing service. The fair value of auction rate securities is estimated using a discounted cash flow analysis or other type of valuation model. These estimates are highly judgmental and incorporate, among other items, the likelihood of redemption, credit and liquidity spreads, duration, interest rates and the timing and amount of expected future cash flows. These securities are also compared, when possible, to other observable data with characteristics similar to the securities held by the Company. The fair value of contingent consideration related to acquisitions is estimated utilizing a probability-weighted discounted cash flow analysis based on the terms of the underlying purchase agreement. The significant unobservable inputs used in calculating the fair value of contingent consideration include financial performance scenarios, the probability of achieving those scenarios and the discount rate. The fair value of interest rate swaps is estimated using a discounted cash flow analysis on the expected future cash flows of each interest rate swap. This analysis reflects the contractual terms of the interest rate swap, including the remaining period to maturity, and uses market-corroborated inputs, including forward interest rate curves and implied interest rate volatilities. The fair value of an interest rate swap is estimated by netting the discounted future fixed cash payments against the discounted expected variable cash receipts. The variable cash receipts are estimated based on an expectation of future interest rates derived from forward interest rate curves. The fair value of an interest rate swap also incorporates credit valuation adjustments to reflect the nonperformance risk of the Company and the respective counterparty. In adjusting the fair value of its interest rate swaps for the effect of nonperformance risk, the Company considers the impact of its master netting agreements. Other Fair Value Disclosures The carrying amount and fair value of debt issued or assumed by the Company were as follows (in thousands): September 30, 2016 December 31, 2015 Carrying Amount Fair Value (1) Carrying Amount Fair Value (1) 2021 Convertible Notes $ 230,000 $ 230,000 $ — $ — 2020 Convertible Notes 294,229 359,042 284,241 298,494 Term Loan Facility B 678,504 685,105 682,915 656,688 Total $ 1,202,733 $ 1,274,147 $ 967,156 $ 955,182 (1) The fair value of debt issued 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. |
Goodwill And Intangible Assets,
Goodwill And Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill And Intangible Assets, Net | Goodwill and Intangible Assets, Net Goodwill Goodwill allocated to the reportable segments and changes in the carrying amount of goodwill by reportable segment were as follows (in thousands): Intellectual Property Licensing Product Total December 31, 2015 $ 1,184,500 $ 159,152 $ 1,343,652 TiVo Acquisition 106,566 357,545 464,111 Foreign currency translation — 860 860 September 30, 2016 $ 1,291,066 $ 517,557 $ 1,808,623 Goodwill at each reporting unit is evaluated for potential impairment annually and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. Goodwill is evaluated annually for potential impairment as of the beginning of the fourth quarter. Intangible Assets, Net Intangible assets, net consisted of the following (in thousands): September 30, 2016 Weighted-Average Remaining Useful Life Gross Accumulated Net Finite-lived intangible assets Developed technology and patents 5.8 years $ 1,031,687 $ (564,495 ) $ 467,192 Existing contracts and customer relationships 11.0 years 402,524 (45,154 ) 357,370 Content databases and other 6.3 years 59,688 (48,719 ) 10,969 Trademarks / Tradenames N/A 8,300 (8,300 ) — Total Finite-lived 1,502,199 (666,668 ) 835,531 Indefinite-lived intangible assets TiVo Tradename N/A 14,000 — 14,000 Total intangible assets $ 1,516,199 $ (666,668 ) $ 849,531 December 31, 2015 Gross Accumulated Net Finite-lived intangible assets Developed technology and patents $ 875,188 $ (512,060 ) $ 363,128 Existing contracts and customer relationships 47,524 (36,933 ) 10,591 Content databases and other 59,014 (45,991 ) 13,023 Trademarks / Tradenames 8,300 (8,300 ) — Total intangible assets $ 990,026 $ (603,284 ) $ 386,742 In connection with the TiVo Acquisition on September 7, 2016 , intangible assets with an aggregate fair value of $523.0 million were acquired. The weighted-average amortization period for Developed technology and patents and Existing contracts and customer relationships is 8 years and 11 years , respectively. The TiVo trade name has been assigned an indefinite useful life. The weighted-average amortization periods may change based on the final purchase price allocation. See Note 2 for additional information about the valuation of the acquired intangible assets. In January 2016, the Company purchased a portfolio of patents for $2.5 million in cash. The Company accounted for the patent portfolio purchase as an asset acquisition and is amortizing the purchase price over a weighted average period of 5.3 years . As of September 30, 2016 , future estimated amortization expense for finite-lived intangible assets was as follows (in thousands): Remainder of 2016 $ 41,932 2017 166,214 2018 146,794 2019 109,345 2020 108,579 Thereafter 262,667 Total $ 835,531 |
Restructuring and Asset Impairm
Restructuring and Asset Impairment Charges | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Asset Impairment Charges | Restructuring and Asset Impairment Charges Components of all Restructuring and asset impairment charges were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Future minimum lease payments, net $ — $ 435 $ 214 $ 1,934 Severance costs 7,580 (217 ) 7,968 (177 ) Share-based payments 14,731 — 14,731 — Contract termination costs — — 1,279 — Asset impairment — — 452 — Restructuring and asset impairment charges $ 22,311 $ 218 $ 24,644 $ 1,757 Accrued restructuring costs for all plans were as follows (in thousands): September 30, 2016 December 31, 2015 Future minimum lease payments, net $ 655 $ 2,015 Severance costs 6,975 250 Contract termination costs 120 — Accrued restructuring costs $ 7,750 $ 2,265 We expect Accrued restructuring costs , including those associated with the TiVo Acquisition , to be paid at various dates through December 31, 2017. Q3 2016 TiVo Corporation Restructuring Plan Following completion of the TiVo Acquisition , TiVo Corporation began implementing its integration plans which are intended to realize operational synergies between Rovi and TiVo Solutions . As a result of these integration plans, TiVo Corporation expects to eliminate duplicative positions resulting in severance costs and the termination of certain leases and other contracts. Charges for the three and nine months ended September 30, 2016 for the Q3 2016 TiVo Corporation Restructuring Plan primarily relate to termination and transition agreements with former TiVo Solutions ' senior executives and Rovi Corporation's former Chief Operating Officer. Restructuring activities related to the Q3 2016 TiVo Corporation Restructuring Plan for the three and nine months ended September 30, 2016 were as follows (in thousands): Balance at Beginning of Period Restructuring Expense Cash Settlements Non-Cash Settlements Balance at End of Period Severance $ — $ 7,580 $ (1,599 ) $ — $ 5,981 Share-based payments — 14,731 — (14,731 ) — Total $ — $ 22,311 $ (1,599 ) $ (14,731 ) $ 5,981 Legacy Rovi Plans In the three months ended March 31, 2016, Rovi initiated certain facility rationalization activities, including relocating its corporate headquarters from Santa Clara, California to San Carlos, California and consolidating its Silicon Valley operations into the new corporate headquarters, and eliminated a number of positions associated with a reorganization of the sales force structure, downsizing the global services workforce and eliminating certain general and administrative positions. As a result of these actions, Restructuring and asset impairment charges of $2.3 million were recognized in the nine months ended September 30, 2016 . No Restructuring and asset impairment charges were recognized in the three months ended September 30, 2016 for the legacy Rovi plans. As of September 30, 2016 , a restructuring accrual of $1.0 million is included in the accrued liabilities in the Condensed Consolidated Balance Sheets . In conjunction with the disposition of the Rovi Entertainment Store, DivX and MainConcept businesses and the Company's narrowed business focus on discovery, in 2014 the Company conducted a review of its remaining product development, sales, data operations and general and administrative functions to identify potential cost efficiencies. As a result of this analysis, the Company took cost reduction actions that resulted in Restructuring and asset impairment charges . Amounts recognized in three and nine months ended September 30, 2015 represent adjustments to the amounts originally recorded in connection with the 2014 restructuring actions. |
Debt and Interest Rate Swaps
Debt and Interest Rate Swaps | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt and Interest Rate Swaps | Debt and Interest Rate Swaps A summary of the Company's financing arrangements was as follows (dollars in thousands): September 30, 2016 December 31, 2015 Stated Interest Rate Issue Date Maturity Date Outstanding Principal Carrying Amount Outstanding Principal Carrying Amount 2021 Convertible Notes 2.000% September 22, 2014 October 1, 2021 $ 230,000 $ 230,000 $ — $ — 2020 Convertible Notes 0.500% March 4, 2015 March 1, 2020 $ 345,000 $ 294,229 $ 345,000 $ 284,241 Term Loan Facility B Variable July 2, 2014 July 2, 2021 684,250 678,504 689,500 682,915 Total Long-term debt $ 1,259,250 1,202,733 $ 1,034,500 967,156 Less: Current portion of long-term debt 237,000 7,000 Long-term debt, less current portion $ 965,733 $ 960,156 2021 Convertible Notes TiVo Solutions issued $230.0 million in aggregate principal of 2.0% Convertible Senior Notes that mature October 1, 2021 (the " 2021 Convertible Notes ") at par pursuant to an Indenture dated September 22, 2014 ("the 2014 Indenture "). The 2021 Convertible Notes bear interest at an annual rate of 2.0% , payable semi-annually in arrears on April 1 and October 1 of each year, commencing April 2015. The 2021 Convertible Notes were convertible at an initial conversion rate of 56.1073 shares of TiVo Solutions common stock per $1,000 principal of notes, which was equivalent to an initial conversion price of $17.8230 per share of TiVo Solutions common stock, subject to adjustment pursuant to the 2014 Indenture . Following the TiVo Acquisition , the 2021 Convertible Notes are convertible at a conversion rate of 21.6181 shares of TiVo Corporation common stock per $1,000 principal of notes and $154.30 per $1,000 principal of notes, which is equivalent to a conversion price of $39.12 per share of TiVo Corporation common stock, subject to the 2014 Indenture . TiVo Solutions can settle the 2021 Convertible Notes in cash, shares of common stock, or any combination thereof. Subject to certain exceptions, holders may require TiVo Solutions to repurchase, for cash, all or part of their 2021 Convertible Notes upon a “Fundamental Change” (as defined in the 2014 Indenture ) at a price equal to 100% of the principal amount of the 2021 Convertible Notes being repurchased plus any accrued and unpaid interest up to, but excluding, the “Fundamental Change Repurchase Date” (as defined in the 2014 Indenture ). In addition, on a “Make-Whole Fundamental Change” (as defined in the 2014 Indenture ) prior to the maturity date of the 2021 Convertible Notes , TiVo Solutions will, in some cases, increase the conversion rate for a holder that elects to convert its 2021 Convertible Notes in connection with such Make-Whole Fundamental Change. On May 3, 2016, TiVo Solutions gave notice to holders of the 2021 Convertible Notes that the TiVo Acquisition constitutes a Fundamental Change under the 2021 Convertible Notes . On August 17, 2016, TiVo Solutions gave notice to holders of the 2021 Convertible Notes that the anticipated "Effective Date" (as defined in the 2014 Indenture ) of the TiVo Acquisition was September 7, 2016 and that the TiVo Acquisition requires a supplemental indenture pursuant to the 2014 Indenture . As the 2021 Convertible Notes are subject to repurchase following the acquisition of TiVo Solutions , the carrying amount of the 2021 Convertible Notes has been presented as a current liability in the Condensed Consolidated Balance Sheets . On October 12, 2016 , TiVo Solutions repaid $229.95 million of the par value of the 2021 Convertible Notes . Purchased Call Options and Sold Warrants related to the 2021 Convertible Notes In September 2014, counterparties entered into convertible note hedge transactions with TiVo Solutions covering approximately 12.9 million shares of TiVo Solutions ’ common stock, in the aggregate, which is the number of shares initially underlying the 2021 Convertible Notes . In connection with the Fundamental Change under the 2021 Convertible Notes , TiVo Solutions and the counterparties agreed to terminate the convertible note hedge transactions early. During the three months ended September 30, 2016 , TiVo Solutions received $5.7 million from the counterparties to settle a portion of the convertible note hedge transactions. Concurrent with the purchase of the convertible note hedge transactions, TiVo Solutions sold warrants to purchase up to approximately 12.9 million shares of TiVo Solutions ’ common stock, in the aggregate, which is the number of shares initially underlying the 2021 Convertible Notes . In connection with the Fundamental Change under the 2021 Convertible Notes , TiVo Solutions and the counterparties agreed to terminate the warrants early. During the three months ended September 30, 2016 , TiVo Solutions paid $2.9 million to the counterparties to settle a portion of the warrants. 2020 Convertible Notes Rovi issued $345.0 million in aggregate principal of 0.500% Convertible Senior Notes that mature March 1, 2020 (the “ 2020 Convertible Notes ”) at par pursuant to an Indenture dated March 4, 2015 (the " 2015 Indenture "). The 2020 Convertible Notes were sold in a private placement and bear interest at an annual rate of 0.500% payable semi-annually in arrears on March 1 and September 1 of each year, commencing September 1, 2015. In connection with the TiVo Acquisition , TiVo Corporation and Rovi entered into a supplemental indenture under which TiVo Corporation became a guarantor of the 2020 Convertible Notes and the notes became convertible into TiVo Corporation common stock. The 2020 Convertible Notes are convertible at an initial conversion rate of 34.5968 shares of common stock per $1,000 of principal of notes, which is equivalent to an initial conversion price of $28.9044 per share of common stock. Holders may convert the 2020 Convertible Notes , prior to the close of business on the business day immediately preceding December 1, 2019 , in multiples of $1,000 of principal under the following circumstances: • 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. On or after December 1, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert the 2020 Convertible Notes , in multiples of $1,000 of principal, at any time. In addition, during the 35 -day trading period following a Merger Event, as defined in the 2015 Indenture , holders may convert the 2020 Convertible Notes , in multiples of $1,000 of principal. The TiVo Acquisition is considered a Merger Event pursuant to the 2015 Indenture . No holders elected to convert their 2020 Convertible Notes during the 35-day trading period following the TiVo Acquisition . On conversion, a holder will receive the conversion value of the 2020 Convertible Notes converted based on the conversion rate multiplied by the volume-weighted average price of TiVo Corporation ’s common stock over a specified observation period. On conversion, Rovi will pay cash up to the aggregate principal amount of the 2020 Convertible Notes converted and deliver shares of TiVo Corporation ’s common stock in respect of the remainder, if any, of the conversion obligation in excess of the aggregate principal of the 2020 Convertible Notes being converted. The initial conversion rate will be subject to adjustment in certain events, including certain events that constitute a make-whole fundamental change (as defined in the 2015 Indenture ). In addition, if Rovi undergoes a fundamental change (as defined in the 2015 Indenture ) prior to March 1, 2020, holders may require Rovi to repurchase for cash all or a portion of the 2020 Convertible Notes at a repurchase price equal to 100% of the principal of the repurchased 2020 Convertible Notes , plus accrued and unpaid interest. The initial conversion rate is also subject to customary anti-dilution adjustments. The 2020 Convertible Notes are not redeemable prior to maturity by Rovi and no sinking fund is provided. The 2020 Convertible Notes are unsecured and do not contain financial covenants or restrictions on the payment of dividends, the incurrence of indebtedness or the repurchase of other securities by Rovi . The 2015 Indenture includes customary terms and covenants, including certain events of default after which the 2020 Convertible Notes may be due and payable immediately. TiVo Corporation has separately accounted for the liability and equity components of the 2020 Convertible Notes . The initial carrying amount of the liability component was calculated by estimating the value of the 2020 Convertible Notes using TiVo Corporation ’s estimated non-convertible borrowing rate of 4.75% at the time the instrument was issued. The carrying amount of the equity component, representing the value of the conversion option, was determined by deducting the liability component from the principal amount of the 2020 Convertible Notes . The difference between the principal amount of the 2020 Convertible Notes and the liability component is considered a debt discount which is being amortized to interest expense using the effective interest method over the expected term of the 2020 Convertible Notes . The equity component of the 2020 Convertible Notes was recorded as a component of Additional paid-in capital in the Condensed Consolidated Balance Sheets and will not be remeasured as long as it continues to meet the conditions for equity classification. Related to the 2020 Convertible Notes , the Condensed Consolidated Balance Sheets included the following (in thousands): September 30, 2016 December 31, 2015 Liability component Principal outstanding $ 345,000 $ 345,000 Less: Unamortized debt discount (45,215 ) (54,215 ) Less: Unamortized debt issuance costs (5,556 ) (6,544 ) Carrying amount $ 294,229 $ 284,241 Equity component $ 63,854 $ 63,854 Components of interest expense related to the 2020 Convertible Notes included in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stated interest $ 431 $ 431 $ 1,294 $ 1,006 Amortization of debt discount 3,035 2,897 9,000 6,708 Amortization of debt issuance costs 338 351 988 814 Total interest expense $ 3,804 $ 3,679 $ 11,282 $ 8,528 Rovi incurred $9.3 million in transaction costs related to the issuance of the 2020 Convertible Notes which were allocated to liability and equity components based on the relative amounts calculated for the 2020 Convertible Notes at the date of issuance. Transaction costs of $7.6 million attributable to the liability component were recorded in Long-term debt, less current portion in the Condensed Consolidated Balance Sheets and are being amortized to interest expense using the effective interest method over the expected term of the 2020 Convertible Notes . Transaction costs of $1.7 million attributable to the equity component were recorded as a component of Additional paid-in capital in the Condensed Consolidated Balance Sheets . Purchased Call Options and Sold Warrants related to the 2020 Convertible Notes Concurrent with the issuance of the 2020 Convertible Notes , Rovi paid $64.8 million to purchase call options with respect to its common stock. The call options give TiVo Corporation the right, but not the obligation, to purchase up to 11.9 million shares of TiVo Corporation 's common stock at a strike price of $28.9044 per share, which corresponds to the initial conversion price of the 2020 Convertible Notes , and are exercisable by TiVo Corporation on conversion of the 2020 Convertible Notes . The call options are intended to reduce the potential dilution from conversion of the 2020 Convertible Notes . The purchased call options are separate transactions from the 2020 Convertible Notes and holders of the 2020 Convertible Notes do not have any rights with respect to the purchased call options. Concurrent with the issuance of the 2020 Convertible Notes , Rovi received $31.3 million from the sale of warrants that provide the holder of the warrant the right, but not the obligation, to purchase up to 11.9 million shares of TiVo Corporation common stock at a strike price of $40.1450 per share. The warrants are exercisable beginning June 1, 2020 and can be settled in cash or shares at TiVo Corporations election. The warrants were entered into to offset the cost of the purchased call options. The warrants are separate transactions from the 2020 Convertible Notes and holders of the 2020 Convertible Notes do not have any rights with respect to the warrants. The amounts paid to purchase the call options and received to sell the warrants were recorded in Additional paid-in capital in the Condensed Consolidated Balance Sheets . Senior Secured Credit Facility On July 2, 2014, Rovi Corporation, as parent guarantor, and two of its wholly-owned subsidiaries, Rovi Solutions Corporation and Rovi Guides, Inc., as borrowers, and certain of its other subsidiaries, as subsidiary guarantors, entered into a Credit Agreement (the “ Credit Agreement ”). After the completion of the TiVo Acquisition , TiVo Corporation became a guarantor under the Credit Agreement . The Credit Agreement provided for a (i) five -year $125.0 million term loan A facility (“ Term Loan Facility A ”), (ii) seven -year $700.0 million term loan B facility (“ Term Loan Facility B ” and together with Term Loan Facility A , the “ Term Loan Facility ”) and (iii) five -year $175.0 million revolving credit facility (including a letter of credit sub-facility) (the " Revolving Facility ” and together with the Term Loan Facility , the “ Senior Secured Credit Facility ”). Loans under Term Loan Facility A bore interest, at the Company's option, at a rate equal to either the London Interbank Offering Rate ("LIBOR"), plus an applicable margin equal to 2.25% per annum, or the prime lending rate, plus an applicable margin equal to 1.25% per annum. Loans under Term Loan Facility B bear interest, at the Company's option, at a rate equal to either LIBOR, plus an applicable margin equal to 3.00% per annum (subject to a 0.75% LIBOR floor) or the prime lending rate, plus an applicable margin equal to 2.00% per annum. Loans under the Revolving Facility bore interest, at the Company's option, at a rate equal to either LIBOR, plus an applicable margin equal to 2.25% per annum, or the prime lending rate, plus an applicable margin equal to 1.25% per annum, subject to reduction by 0.25% or 0.50% based on the Company's total secured leverage ratio (as defined in the Credit Agreement). In June 2015 and September 2015, the Company made voluntary principal prepayments of $50.0 million and $75.0 million , respectively, on Term Loan Facility A . The September 2015 voluntary principal prepayment extinguished Term Loan Facility A . In February 2015, the Company borrowed $100.0 million against the Revolving Facility , in part, to extinguish a portion of the 2040 Convertible Notes . In March 2015, using a portion of the proceeds from the 2020 Convertible Notes issuance, all outstanding borrowings under the Revolving Facility were repaid. In September 2015, the Revolving Facility was terminated at the Company's election. The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, prepayment of other indebtedness, and dividends and other distributions. The Credit Agreement is secured by substantially all of the Company's assets. The Company may be required to make an additional payment on the Term Loan Facility each February. This payment is calculated as a percentage of the prior year's Excess Cash Flow as defined in the Credit Agreement . No additional payment was required in February 2016. Convertible Senior Notes Due 2040 The Company issued $460.0 million in aggregate principal of 2.625% Convertible Senior Notes due in 2040 at par (the “ 2040 Convertible Notes ”) pursuant to an Indenture dated March 17, 2010 (the " 2010 Indenture "). On February 20, 2015, holders of $287.4 million of outstanding principal exercised their right to require the Company to repurchase their 2040 Convertible Notes for cash. On June 30, 2015, the Company redeemed the remaining $3.6 million of outstanding 2040 Convertible Notes . In connection with these transactions, $0.1 million was recorded as Loss on debt extinguishment in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2015 . Components of interest expense related to the 2040 Convertible Notes included in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stated interest $ — $ — $ — $ 1,114 Amortization of debt discount — — — 1,865 Amortization of debt issue costs — — — 242 Total interest expense $ — $ — $ — $ 3,221 Debt Maturities As of September 30, 2016 , aggregate expected future principal payments on long-term debt, including the current portion of long-term debt, were as follows (in thousands): Remainder of 2016 (1) $ 231,750 2017 7,000 2018 7,000 2019 (2) 352,000 2020 7,000 Thereafter 654,500 Total $ 1,259,250 (1) While the 2021 Convertible Notes are scheduled to mature on October 1, 2021 and can be freely converted by holders beginning on July 1, 2021 , future principal payments are presented based on the date holders can require TiVo Solutions to repurchase the 2021 Convertible Notes . Rovi 's acquisition of TiVo Solutions constitutes a Fundamental Change under the 2021 Convertible Notes , which requires TiVo Solutions to offer to repurchase the 2021 Convertible Notes at par plus accrued and unpaid interest. On October 12, 2016 , $229.95 million of the 2021 Convertible Notes were repaid. (2) 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. Interest Rate Swaps The Company issues long-term debt denominated in U.S. dollars based on market conditions at the time of financing and may enter into interest rate swaps to achieve a primarily fixed interest rate. Alternatively, the Company may choose not to enter into interest rate swaps or may terminate a previously executed swap if it believes a larger proportion of floating-rate debt would be beneficial. The Company has not designated any of its interest rate swaps as hedges for accounting purposes. The Company records interest rate swaps in the Condensed Consolidated Balance Sheets at fair value with changes in fair value recorded as Income (loss) on interest rate swaps in the Condensed Consolidated Statements of Operations . During the three months ended September 30, 2016 and 2015 , the Company recorded a gain of $ 1.7 million and a loss of $ 11.8 million , respectively, on its interest rate swaps. During the nine months ended September 30, 2016 and 2015 , the Company recorded losses of $ 16.9 million and $ 17.1 million , respectively, on its interest rate swaps. Details of the Company's interest rate swaps as of September 30, 2016 and December 31, 2015 were as follows (dollars in thousands): Notional Contract Inception Contract Effective Date Contract Maturity September 30, 2016 December 31, 2015 Interest Rate Paid Interest Rate Received Senior Secured Credit Facility May 2012 January 2014 January 2016 $ — $ 197,000 (1) One month USD-LIBOR May 2012 April 2014 March 2017 $ 215,000 $ 215,000 (2) One month USD-LIBOR 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 (1) The Company paid a fixed interest rate which gradually increased from 0.58% for the three-month settlement period ended in June 2014 to 1.65% for the settlement period ended in January 2016 . (2) The Company pays a fixed interest rate which gradually increases from 0.65% for the three-month settlement period ended in June 2014 to 2.11% for the settlement period ending in March 2017 . |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Product Warranties The Company’s standard manufacturer's warranty period to consumers for TiVo-enabled DVRs is 90 days for parts and labor from the date of consumer purchase, and from 91 - 365 days for parts only. Within the limited warranty period, consumers are offered a no-charge exchange for TiVo-enabled DVRs returned due to product defect, within 90 days from the date of consumer purchase. Thereafter, consumers may exchange a TiVo-enabled DVR with a product defect for a variable charge. The Company also includes a warranty through its Continual Care program to TiVo-Owned customers who use Roamio and BOLT DVRs for as long as they are monthly or annual subscribers to the TiVo service. The Company recognizes the cost associated with the Continual Care warranties at the time of the DVR sale. As of September 30, 2016 , the accrued warranty was $0.3 million and is included in Accounts payable and accrued expenses in the Condensed Consolidated Balance Sheets . TiVo-Owned customers who purchase a lifetime subscription are also able to purchase separately priced optional two -year and three -year extended warranties. The Company defers and amortizes revenue and costs associated with the sales of these extended warranties over the warranty period or until a warranty is redeemed. Additionally, the Company offers its MSO customers separately priced optional three -year extended warranties. The Company recognizes the revenues associated with the sale of these MSO extended warranties over the second and third year of the warranty period. As of September 30, 2016 , the extended warranty deferred revenue and deferred cost were $1.3 million and $0.1 million , respectively. The Company’s extended warranty deferred revenue is included in Deferred revenue and extended warranty deferred costs are included in Other Assets in the Condensed Consolidated Balance Sheets . Purchase Commitments In August 2016, Rovi entered into a 10 -year patent license agreement with DISH Network L.L.C. (“DISH”). Under the license agreement, DISH will pay Rovi for the period beginning on April 5, 2016 based on a monthly, per-subscriber fee, consistent with Rovi ’s existing licensing program for its largest Pay-TV providers. In addition, DISH agreed to provide TiVo Inc. with a release for all past products and a going-forward covenant not-to-sue under DISH’s existing patents during the 10-year license term in exchange for TiVo Solutions providing DISH certain TiVo Solutions products during the term and cash payments by TiVo Solutions to DISH of $60.3 million in the aggregate over the next twelve months. The TiVo Solutions release and covenant transaction will be recognized as a reduction to revenue over the license term in the Condensed Consolidated Statements of Operations . No changes have been made to the prior, existing patent settlement between EchoStar, DISH Network Corporation, and TiVo Solutions . The Company purchases components from a variety of suppliers and use several contract manufacturers to provide manufacturing services for its products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, the Company enters into agreements with contract manufacturers and suppliers that either allow them to procure inventory based on criteria as defined by the Company or that establish the parameters defining the Company’s requirements. A significant portion of the Company’s reported purchase commitments arising from these agreements consists of firm, non-cancelable, and unconditional purchase commitments. In certain instances, these agreements allow the Company the option to cancel, reschedule, and adjust the Company’s requirements based on its business needs prior to firm orders being placed. As of September 30, 2016 , the Company had total purchase commitments for inventory of $14.8 million . Lease Commitments The Company leases facilities and certain equipment pursuant to non-cancelable operating lease agreements expiring through 2026 . Rent expense is recognized on a straight-line basis over the lease term. Lease incentives are amortized over the lease term on a straight-line basis. Future minimum payments for operating leases as of September 30, 2016 were as follows (in thousands): Remainder of 2016 $ 4,411 2017 16,869 2018 15,262 2019 13,073 2020 11,464 Thereafter 57,462 Gross future minimum lease payments $ 118,541 Less: Sublease revenues (5,789 ) Net future minimum lease payments $ 112,752 Indemnifications In the normal course of business, the Company provides indemnifications of varying scopes and amounts to certain of its licensees against claims made by third parties arising out of the use and / or incorporation of the Company's products, intellectual property, services and / or technologies into the licensees' products and services. TiVo Solutions has also undertaken to indemnify certain customers and business partners for, among other things, the licensing of its products, the sale of its DVRs, and the provision of engineering and consulting services. The Company’s obligation to provide indemnification under its agreements with customer and business partners would arise in the event that a third party filed a claim against one of the parties that was covered by the Company’s indemnification obligation. Pursuant to these agreements, the Company may indemnify the other party for certain losses suffered or incurred by the indemnified party in connection with various types of claims, which may include, without limitation, intellectual property infringement, advertising and consumer disclosure laws, certain tax liabilities, negligence and intentional acts in the performance of services and violations of laws. In some cases, the Company may receive tenders of defense and indemnity arising out of products, intellectual property services and / or technologies that are no longer provided by the Company due to having divested certain assets, but which were previously licensed or provided by the Company. The term of the Company's indemnification obligations is generally perpetual. The Company's indemnification obligations are typically limited to the cumulative amount paid to the Company by the licensee under the license agreement; however, some license agreements, including those with the Company's largest MSO and digital broadcast satellite providers, have larger limits or do not specify a limit on amounts that may be payable under the indemnity arrangements. The Company cannot reasonably estimate the possible range of losses that may be incurred pursuant to its indemnification obligations, if any. Variables affecting any such assessment include but are not limited to: the nature of the claim asserted; the relative merits of the claim; the financial ability of the party suing the indemnified party to engage in protracted litigation; the number of parties seeking indemnification; the nature and amount of damages claimed by the party suing the indemnified party; and the willingness of such party to engage in settlement negotiations. Due to the nature of the Company's potential indemnity liability, the Condensed Consolidated Financial Statements could be materially affected in a particular period by one or more of these indemnities Under certain circumstances, TiVo Solutions may seek to recover some or all amounts paid to an indemnified party from its insurers. TiVo Solutions does not have any assets held either as collateral or by third parties that, on the occurrence of an event requiring it to indemnify a customer, TiVo Solutions could obtain and liquidate to recover all or a portion of the amounts paid pursuant to its indemnification obligations. Legal Proceedings The Company is involved in various lawsuits, claims and proceedings, including those identified below, consisting of intellectual property, commercial, securities, and employment matters that arise in the normal course of business. The Company accrues a liability when management believes information available prior to the issuance of the financial statements indicates it is probable a loss has been incurred as of the date of the financial statements and the amount of loss can be reasonably estimated. The Company adjusts its accruals to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case. The Company believes it has recorded adequate provisions for any such matters and, as of September 30, 2016 , it was not reasonably possible that a material loss had been incurred in excess of the amounts recognized in the Condensed Consolidated Financial Statements . Legal costs are expensed as incurred. Based on its experience, the Company believes that damage amounts claimed in these matters are not meaningful indicators of potential liability. Some of the matters pending against the Company involve potential compensatory, punitive or treble damage claims or sanctions, that, if granted, could require the Company to pay damages or make other expenditures in amounts that could have a material adverse effect on its Condensed Consolidated Financial Statements . On May 10, 2016, Rovi received a letter from Dolby Laboratories, Inc. (“Dolby”) demanding unpaid royalties in the amount of $11.5 million related to (i) software licensed by Rovi 's Sonic Solutions subsidiary and (ii) certain support and maintenance agreements that Sonic had with certain larger customers during the period from 2009 to 2012. Dolby further claimed that it was entitled to interest on the allegedly unpaid royalties in the amount of $11.8 million . The alleged unpaid royalties cover products that were divested by Rovi from 2012 to 2014 and presented as a discontinued operation. On July 20, 2016, Rovi received another letter from Dolby, proposing to forego the interest it claims it is owed relating to certain portions of the dispute if a settlement is reached promptly. However, Dolby added an additional demand for unpaid royalties in the amount of $9.5 million related to software distributions allegedly made by Rovi 's MainConcept subsidiary (which was divested by Rovi in 2014 and presented as a discontinued operation), for a total demand of $20.9 million . As a result of the settlement described in Note 14, during the three months ended September 30, 2016 , the Company increased its reserve for this matter from $0.5 million to $5.0 million . The expense resulting from the settlement was recognized in Loss from discontinued operations, net of tax for the three and nine months ended September 30, 2016 . As of September 30, 2016 , Rovi had accrued $5.0 million in Accounts payable and accrued expenses in its Condensed Consolidated Balance Sheets for this matter. On September 8, 2015, TiVo Solutions filed a complaint against Samsung Electronics Co., LTD, Samsung Electronics America, Inc., and Samsung Telecommunications America, LLC. (“Samsung”) in the United States District Court for the Eastern District of Texas. The complaint asserts U.S. Patent No. 6,233,389, titled “Multimedia Time Warping System,” U.S. Patent No. 6,792,195, titled “Method And Apparatus Implementing Random Access And Time-Based Functions On A Continuous Stream Of Formatted Digital Data,” U.S. Patent No. 7,558,472, titled “Multimedia Signal Processing System,” and U.S. Patent No. 8,457,476, titled “Multimedia Signal Processing System.” The complaint claims that Samsung infringes TiVo Solutions ' patents by making and selling Samsung DVRs and mobile devices, and related software, that fall within the scope of one or more claims of TiVo Solutions ’ patents. TiVo Solutions ' complaint also claims that Samsung’s infringement is willful, and seeks, among other things, an unspecified amount in damages as well as an injunction. On November 17, 2015, Samsung filed an answer denying TiVo Solutions ’ allegations. On February 11, 2016, Samsung amended its answer to assert U.S. Patent No. 5,978,043, titled “TV Graphical User Interface That Provides Customized Lists Of Programming,” U.S. Patent No. 6,181,333, titled “Television Graphical User Interface Having Channel And Program Sorting Capabilities,” U.S. Patent No. 7,231,592, titled “Method And Apparatus For A Home Network Auto-Tree Builder,” and U.S. Patent No. 8,233,090, titled “Method Of Linkage-Viewing TV Broadcasting Program Between Mobile Communication Apparatus And Digital TV, And Mobile Communication Apparatus And Digital TV Thereof” against TiVo Solutions . In its amended answer, Samsung counterclaims that TiVo Solutions infringes Samsung’s patents by making and selling TiVo Solutions DVRs, and related software, that fall within the scope of one or more claims of Samsung’s patents. Samsung’s complaint claims that TiVo Solutions ' infringement is willful, and seeks, among other things, damages in an unspecified amount. On February 22, 2016, the Court issued a preliminary scheduling order, setting jury selection for March 6, 2017. On August 2, 2016, Samsung filed a petition for inter partes review of U.S. Patent No. 6,233,389 with the U.S. Patent and Trademark Office. On August 12, 2016, Samsung filed two petitions for inter partes review of U.S. Patent No. 7,558,472, and two petitions for inter partes review of U.S. Patent No. 8,457,476, with the U.S. Patent and Trademark Office. Given the inherent uncertainties of litigation, the ultimate outcome of the ongoing matters described above cannot be predicted with certainty. While litigation is inherently unpredictable, the Company believes it has valid defenses with respect to the legal matters pending against it. As of September 30, 2016 , the Company does not believe any legal matters, individually or in the aggregate, will have a material adverse effect on its Condensed Consolidated Financial Statements . Nevertheless, the Condensed Consolidated Financial Statements could be materially affected in a particular period by the resolution of one or more of these contingencies. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity (Loss) Earnings Per Share Basic earnings per share ("EPS") is computed using the weighted average number of common shares outstanding during the period. Diluted EPS is computed using the weighted average number of common shares and dilutive common share equivalents outstanding during the period, except for periods of a loss from continuing operations. In periods of a loss from continuing operations, no common share equivalents are included in Diluted EPS because their effect would be anti-dilutive. The number of shares used to calculate Basic EPS and Diluted EPS were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Weighted average shares used in computing basic per share amounts 91,131 82,404 84,895 85,297 Dilutive effect of equity-based compensation awards 1,013 — 963 — Weighted average shares used in computing diluted per share amounts 92,144 82,404 85,858 85,297 Weighted average potential shares excluded from the calculation of Diluted EPS as their effect would have been anti-dilutive were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options 3,332 4,124 3,497 4,236 Restricted awards 1,483 2,832 2,176 2,887 2021 Convertible Notes (1) 1,470 — 494 — 2020 Convertible Notes (1) 11,936 11,936 11,936 9,181 2040 Convertible Notes (1) — — — 1,162 Warrants related to 2020 Convertible Notes (1) 11,936 11,936 11,936 9,181 Weighted average potential shares excluded from the calculation of Diluted EPS 30,157 30,828 30,039 26,647 (1) See Note 8 for additional details. The calculation of earnings per share excludes 3.8 million shares of TiVo Corporation potentially issuable to Dissenting Holders as the Dissenting Holders have not decided whether or not to receive the consideration they are entitled to as a result of the TiVo Acquisition . As the contingency has not been satisfied as of September 30, 2016 , the shares are excluded from the calculation of basic and diluted earnings per share. See Note 2 for additional details. For the three months ended September 30, 2016 and 2015 , 0.7 million and 0.9 million weighted average performance-based restricted awards, respectively, were excluded from the calculation of Diluted EPS as the performance metric had yet to be achieved or their inclusion would have been anti-dilutive. For the nine months ended September 30, 2016 and 2015 , 0.7 million and 0.9 million weighted average performance-based restricted awards, respectively, were excluded from the calculation of Diluted EPS as the performance metric had yet to be achieved or their inclusion would have been anti-dilutive. Effect of the 2020 Convertible Notes and related transactions on Diluted EPS In periods when the Company reports income from continuing operations, the potential dilutive effect of additional shares that may be issued on conversion of the 2020 Convertible Notes are included in the calculation of Diluted EPS under the treasury stock method if the price of the Company’s common stock exceeds the conversion price. The 2020 Convertible Notes have no impact on Diluted EPS until the price of the Company's common stock exceeds the conversion price of $28.9044 per share because the principal of the 2020 Convertible Notes is required to be settled in cash. Based on the closing price of the Company's common stock of $19.48 per share on September 30, 2016 , the if-converted value of the 2020 Convertible Notes was less than the outstanding principal. Under the treasury stock method, the 2020 Convertible Notes would be dilutive if the Company’s common stock closes at or above $28.9044 per share, respectively. However, on conversion, no economic dilution is expected from the 2020 Convertible Notes as the exercise of call options purchased by the Company with respect to its common stock described in Note 8 is expected to eliminate any potential dilution from the 2020 Convertible Notes that would have otherwise occurred. The call options are always excluded from the calculation of Diluted EPS as they are anti-dilutive under the treasury stock method. The warrants sold by the Company with respect to its common stock in connection with the 2020 Convertible Notes described in Note 8 have an effect on Diluted EPS when the Company’s share price exceeds the warrant’s strike price of $40.1450 per share. As the price of the Company’s common stock increases above the warrant strike price, additional dilution would occur. Share Repurchase Program On April 29, 2015, Rovi's Board of Directors authorized the repurchase of up to $125.0 million of the Company's common stock. This authorization does not apply to TiVo Corporation and is no longer in effect. During the three and nine months ended September 30, 2015 , the Company repurchased 4.5 million and 9.5 million shares of its common stock pursuant to the authorized repurchase plan for $50.0 million and $150.2 million , respectively. In connection with the TiVo Acquisition , all shares repurchased by the Company as of September 7, 2016 were retired. The Company accounts for treasury stock using the cost method and includes treasury stock as a component of Accumulated deficit . The Company issues restricted stock units as part of the equity incentive plans described in Note 11. For the majority of restricted stock units, beginning in the fourth quarter of 2015, shares are withheld to satisfy required withholding taxes at the vesting date. Shares withheld to satisfy required withholding taxes in connection with the vesting of restricted stock units are treated as common stock repurchases in the Condensed Consolidated Financial Statements because they reduce the number of shares that would have been issued on vesting. However, these withheld shares are not considered common stock repurchases under the Company's authorized share repurchase plan. During the three and nine months ended September 30, 2016 , the Company withheld 0.3 million and 0.4 million shares of common stock to satisfy $ 5.3 million and $9.4 million of required withholding taxes, respectively. Section 382 Transfer Restrictions On September 7, 2016 , upon the effective time of the TiVo Acquisition , the Company’s certificate of incorporation was amended and restated to include certain transfer restrictions intended to preserve tax benefits related to the net operating loss carryforwards (“NOLs”) of the Company pursuant to Section 382 of Internal Revenue Code of 1986, as amended (the “Code”), that apply to transfers made by 5% stockholders, transferees related to a 5% stockholder, transferees acting in coordination with a 5% stockholder, or transfers that would result in a stockholder becoming a 5% stockholder. If the Company experiences an “ownership change,” as defined in Section 382 of the Code, its ability to fully utilize the NOLs on an annual basis will be substantially limited, and the timing of the usage of the NOLs could be substantially delayed, which could therefore significantly impair the value of those benefits. These transfer restrictions are intended to act as a deterrent to any person (an “Acquiring Person”) acquiring (together with all affiliates and associates of such person) beneficial ownership of 5% or more of the Company's outstanding common stock within the meaning of Section 382 of the Code, without the approval of the Company's Board of Directors. Such transfer restrictions will expire on the earlier of (i) the repeal of Section 382 or any successor statute if the Company’s Board of Directors determines that such restrictions are no longer necessary or desirable for the preservation of certain tax benefits, (ii) the beginning of a taxable year to which the Company’s Board of Directors determines that no tax benefits may be carried forward or (iii) such other date as the Company’s Board of Directors shall fix in accordance with the Company’s certificate of incorporation. The Company plans to seek a stockholder advisory vote with respect to the maintenance of such transfer restrictions in its certificate of incorporation at its 2017 Annual Meeting of Stockholders. Changes in Stockholders' Equity Stockholders’ equity as of September 30, 2016 and 2015 and changes in stockholders’ equity during the three months ended September 30, 2016 and 2015 were as follows (in thousands): Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of June 30, 2016 131,888 $ 132 (48,586 ) $ (1,167,575 ) $ 2,445,589 $ (3,544 ) $ (246,511 ) $ 1,028,091 Net income (loss) 49,922 49,922 Foreign currency translation adjustment, net of tax 452 Unrealized (losses) gains on marketable securities, net of tax (282 ) Other comprehensive loss 170 170 Issuance of common stock upon exercise of options 29 — 496 496 Issuance of common stock under employee stock purchase plan 652 1 6,139 6,140 Issuance of restricted stock, net 90 — — — Equity-based compensation 28,421 28,421 Issuance of common stock in connection with TiVo Acquisition 35,838 36 773,989 774,025 Cancellation of treasury stock (48,606 ) (49 ) 48,606 1,167,954 (1,167,905 ) — Stock repurchases (252 ) (5,323 ) (5,323 ) Balances as of September 30, 2016 119,891 $ 120 (232 ) $ (4,944 ) $ 3,254,634 $ (3,374 ) $ (1,364,494 ) $ 1,881,942 Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of June 30, 2015 130,756 $ 131 (43,898 ) $ (1,113,386 ) $ 2,397,069 $ (5,871 ) $ (227,291 ) $ 1,050,652 Net income (loss) (18,458 ) (18,458 ) Foreign currency translation adjustment, net of tax 288 Unrealized (losses) gains on marketable securities, net of tax (20 ) Other comprehensive loss 268 268 Issuance of common stock upon exercise of options 13 — 184 184 Issuance of common stock under employee stock purchase plan 291 — 2,716 2,716 Cancellation of restricted stock, net (22 ) — — — Equity-based compensation 8,328 8,328 Excess tax benefit associated with stock plans 15 15 Stock repurchases (4,492 ) (50,000 ) (50,000 ) Balances as of September 30, 2015 131,038 $ 131 (48,390 ) $ (1,163,386 ) $ 2,408,312 $ (5,603 ) $ (245,749 ) $ 993,705 Stockholders’ equity as of September 30, 2016 and 2015 and changes in stockholders’ equity during the nine months ended September 30, 2016 and 2015 were as follows (in thousands): Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of December 31, 2015 131,052 $ 131 (48,405 ) $ (1,163,533 ) $ 2,419,921 $ (6,503 ) $ (219,451 ) $ 1,030,565 Net income (loss) 22,862 22,862 Foreign currency translation adjustment, net of tax 2,636 Unrealized (losses) gains on marketable securities, net of tax 493 Other comprehensive loss 3,129 3,129 Issuance of common stock upon exercise of options 195 — 3,270 3,270 Issuance of common stock under employee stock purchase plan 1,160 2 10,694 10,696 Issuance of restricted stock, net 252 — — — Equity-based compensation 46,760 46,760 Issuance of common stock in connection with TiVo Acquisition 35,838 36 773,989 774,025 Cancellation of treasury stock (48,606 ) (49 ) 48,606 1,167,954 (1,167,905 ) — Stock repurchases (433 ) (9,365 ) (9,365 ) Balances as of September 30, 2016 119,891 $ 120 (232 ) $ (4,944 ) $ 3,254,634 $ (3,374 ) $ (1,364,494 ) $ 1,881,942 Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of December 31, 2014 130,627 $ 131 (38,898 ) $ (1,013,218 ) $ 2,339,817 $ (5,307 ) $ (215,159 ) $ 1,106,264 Net income (loss) (30,590 ) (30,590 ) Foreign currency translation adjustment, net of tax (230 ) Unrealized (losses) gains on marketable securities, net of tax (66 ) Other comprehensive loss (296 ) (296 ) Issuance of common stock upon exercise of options 85 — 1,478 1,478 Issuance of common stock under employee stock purchase plan 543 — 7,289 7,289 Cancellation of restricted stock, net (217 ) — — — Equity-based compensation 31,044 31,044 Excess tax benefit associated with stock plans 66 66 Equity component related to issuance of 2020 Convertible Notes 63,854 63,854 Equity component related to 2020 Convertible Notes issuance costs (1,737 ) (1,737 ) Issuance of warrants related to 2020 Convertible Notes 31,326 31,326 Purchase of call options related to 2020 Convertible Notes (64,825 ) (64,825 ) Stock repurchases (9,492 ) (150,168 ) (150,168 ) Balances as of September 30, 2015 131,038 $ 131 (48,390 ) $ (1,163,386 ) $ 2,408,312 $ (5,603 ) $ (245,749 ) $ 993,705 |
Equity-based Compensation
Equity-based Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Equity-based Compensation | Equity-based Compensation Stock Options and Restricted Awards The Company grants equity-based compensation awards from the Rovi 2008 Equity Incentive Plan (the “Rovi 2008 Plan”). As of September 30, 2016 , the Company had 29.5 million shares reserved and 12.6 million shares available for issuance under the Rovi 2008 Plan. The Rovi 2008 Plan permits the grant of stock options, restricted stock, restricted stock units and similar types of equity awards to employees, officers, directors and consultants of the Company. Stock options generally have vesting periods of four years with one quarter of the grant vesting on the first anniversary of the grant, followed by monthly vesting thereafter. Stock options generally have a contractual term of seven years. Restricted stock is considered outstanding at the time of the grant as holders are entitled to voting rights. Awards of restricted stock and restricted stock units (collectively, "restricted awards") are generally subject to a four year graded vesting period. On September 7, 2016 , the Company assumed the TiVo Inc. Amended and Restated 2008 Equity Incentive Award Plan (the “TiVo 2008 Plan”). Stock options assumed from the TiVo 2008 Plan generally have vesting periods of four years with one quarter of the grant vesting on the first anniversary of the grant, followed by monthly vesting thereafter or vesting monthly over the four year vesting period. Stock options assumed from TiVo 2008 Plan generally have a contractual term of seven years. Restricted stock awards assumed from the TiVo 2008 Plan are generally subject to a three year vesting period, with 17% of the award vesting every six months. As of September 30, 2016 , there were 3.7 million shares reserved and 3.7 million shares available for future grant. The Company has amended and restated the TiVo 2008 Plan effective as of the closing of the TiVo Acquisition to be the Titan Equity Incentive Award Plan for purposes of awards granted following the closing of the TiVo Acquisition . The Company grants performance-based restricted stock units to certain of its senior officers for three year performance periods. Vesting in the awards is subject to either performance conditions or a market condition as well as a three year service period. Depending on the level of achievement, the maximum number of shares that could be issued on vesting could be up to 200% of the target number of performance-based restricted stock units granted. For awards subject to performance conditions, the fair value per award is fixed at the grant date; however, the amount of compensation expense is adjusted throughout the performance period based on the probability of achievement of a target revenue compound annual growth rate and an Adjusted EBITDA (defined in Note 13) margin, with compensation expense based on the number of shares ultimately issued. For awards subject to a market condition, the fair value per award is fixed at the grant date and the amount of compensation expense is not adjusted during the performance period based on changes in the level of achievement of the relative Total Shareholder Return metric. Employee Stock Purchase Plan The Company’s 2008 Employee Stock Purchase Plan (“ESPP”) allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions. The ESPP consists of four six -month purchase periods within a twenty-four month offering period. Employees purchase shares each purchase period at the lower of 85% of the market value of the Company’s common stock at either the beginning of the offering period or the end of the purchase period. As of September 30, 2016 , the Company had 7.3 million shares of common stock reserved and available for issuance under the ESPP. TiVo Acquisition At the TiVo Acquisition Date , each then outstanding TiVo Solutions restricted stock award held by TiVo Solutions employees, other than performance-based awards, and all stock options were replaced with a TiVo Corporation restricted stock award or stock option, as applicable, on the same terms and conditions as the prior TiVo Solutions award. As the employee restricted stock awards and stock options remain outstanding after the TiVo Acquisition Date , holders were not eligible for the cash component of the merger consideration and the number of TiVo Corporation restricted stock awards or stock options delivered at the TiVo Acquisition Date was based on an exchange ratio of 0.5186 . At the TiVo Acquisition Date , each TiVo Solutions performance-based restricted stock award held by TiVo Solutions employees was converted to a TiVo Corporation restricted stock award as if target-level performance had been achieved during the performance period subject to annual vesting based on a three year service period commencing at the grant date of the underlying TiVo Solutions performance-based restricted stock award. Holders of performance-based restricted stock awards at the TiVo Acquisition Date were not eligible for the cash component of the merger consideration and the number of TiVo Corporation restricted stock awards delivered at the TiVo Acquisition Date was based on an exchange ratio of 0.5186 . At the TiVo Acquisition Date , the TiVo Solutions Board of Directors and non-employee holders of TiVo Solutions restricted stock awards and stock options received the intrinsic value of their then outstanding awards on the same terms as TiVo Solutions stockholders (which was comprised of $2.75 per share in cash and 0.3853 shares of TiVo Corporation common stock), and the TiVo Solutions awards were canceled. Valuation Techniques and Assumptions The Company uses the Black-Scholes-Merton option-pricing formula to estimate the fair value of stock options and ESPP shares. The fair value of stock options and ESPP shares is estimated on the grant date using complex and subjective inputs, such as the expected volatility of the Company's common stock over the expected term of the award and projected employee exercise behavior. The Company estimates the fair value of restricted awards subject to service or performance conditions as the market value of the Company's common stock on the date of grant and uses a Monte Carlo simulation to estimate the fair value of restricted stock units subject to market conditions. Assumptions used to estimate the fair value of equity-based compensation awards granted during the period were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options: Expected volatility 55.5 % N/A 55.7 % 45.0 % Expected term 4.1 years N/A 4.1 years 4.0 years Risk-free interest rate 0.9 % N/A 1.1 % 1.3 % Expected dividend yield 0.0 % N/A 0.0 % 0.0 % ESPP shares: Expected volatility 50.4 % 56.0 % 55.6 % 53.0 % Expected term 1.3 years 1.3 years 1.3 years 1.3 years Risk-free interest rate 0.5 % 0.4 % 0.6 % 0.4 % Expected dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Restricted stock units subject to market conditions: Expected volatility 55.9 % N/A 55.9 % 41.0 % Expected term 2.7 years N/A 3.0 years 3.0 years Risk-free interest rate 1.0 % N/A 1.0 % 1.0 % Expected dividend yield 0.0 % N/A 0.0 % 0.0 % Expected volatility is estimated using a combination of historical volatility and implied volatility derived from publicly-traded options on the Company's common stock. When historical data is available and relevant, the expected term of the award is estimated by calculating the average term from historical experience. When there is insufficient historical data to provide a reasonable basis on which to estimate the expected term, the Company uses an average of the vesting period and the contractual term of the award to estimate the expected term of the award. The risk-free interest rate is the yield on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term of the award at the grant date. The Company does not anticipate paying cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero. The number of awards expected to be forfeited during the requisite service period is estimated at the time of grant using historical data and equity-based compensation is only recognized for awards for which the requisite service is expected to be rendered. Forfeiture estimates are revised during the requisite service period and the effect of changes in the number of awards expected to be forfeited during the requisite service period is recorded as a cumulative adjustment in the period estimates are revised. The weighted-average grant date fair value of equity-based awards (per award) and pre-tax equity-based compensation expense (in thousands) was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options $ 7.21 N/A $ 10.15 $ 9.05 ESPP shares $ 7.02 $ 5.12 $ 7.30 $ 5.33 Restricted awards $ 16.70 $ 13.13 $ 22.98 $ 22.27 Pre-tax equity-based compensation, excluding amounts included in restructuring expense $ 13,676 $ 8,328 $ 32,031 $ 31,044 Pre-tax equity-based compensation, included in restructuring expense $ 14,731 $ — $ 14,731 $ — Included in Pre-tax equity-based compensation, excluding amounts included in restructuring expense is $3.5 million of expense for the three and nine months ended September 30, 2016 related to the incremental fair value resulting from the replacement of TiVo Solutions stock-based awards with corresponding TiVo Corporation stock-based awards. As of September 30, 2016 , there was $74.8 million of unrecognized compensation cost, net of estimated forfeitures, related to unvested equity-based awards which is expected to be recognized over a remaining weighted average period of 2.1 years. Equity-Based Compensation Award Activity Activity under the Company's stock option plans for the nine months ended September 30, 2016 was as follows: Options (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (In Thousands) Outstanding at December 31, 2015 3,721 $ 30.37 Assumed in connection with TiVo Acquisition 875 $ 16.24 Granted 223 $ 23.13 Exercised (195 ) $ 16.77 Forfeited and canceled (441 ) $ 31.11 Outstanding at September 30, 2016 4,183 $ 27.58 2.8 years $ 3,873 Vested and expected to vest at September 30, 2016 4,040 $ 27.72 2.7 years $ 3,862 Exercisable at September 30, 2016 3,318 $ 28.65 2.1 years $ 3,790 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that option holders would have received had all option holders exercised their options on the last trading day of the period. The aggregate intrinsic value is the difference between TiVo's closing stock price on the last trading day of the period and the exercise price of the option, multiplied by the number of in-the-money options. The aggregate intrinsic value of stock options exercised is the difference between the market price of the shares at the time of exercise and the exercise price of the stock option multiplied by the number of stock options exercised. The aggregate intrinsic value of stock options exercised during the three months ended September 30, 2016 and 2015 was immaterial. The aggregate intrinsic value of stock options exercised during the nine months ended September 30, 2016 and 2015 was $0.7 million and $0.4 million , respectively. Activity related to the Company's restricted awards for the nine months ended September 30, 2016 was as follows: Restricted Awards (In Thousands) Weighted-Average Grant Date Fair Value Outstanding at December 31, 2015 3,681 $ 21.63 Assumed in connection with TiVo Acquisition 2,409 $ 22.42 Granted 1,338 $ 21.79 Vested (1,578 ) $ 22.24 Forfeited (303 ) $ 21.80 Outstanding at September 30, 2016 5,547 $ 21.83 As of September 30, 2016 , 2.8 million shares of restricted stock were unvested, which includes 0.4 million shares of performance-based restricted stock. As of September 30, 2016 , 2.8 million restricted stock units were unvested, which includes 0.4 million performance-based restricted stock units. The aggregate fair value of restricted awards vested during the three months ended September 30, 2016 and 2015 was $13.1 million and $1.6 million , respectively. The aggregate fair value of restricted awards vested during the nine months ended September 30, 2016 and 2015 was $34.5 million and $24.7 million , respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Due to the fact that the Company has significant net operating loss carryforwards and has recorded a valuation allowance against a significant portion of its deferred tax assets, foreign withholding taxes are the primary driver of Income tax (benefit) expense . During the three and nine months ended September 30, 2016 , the Company recorded an income tax benefit of $88.1 million due to a change in the deferred tax asset valuation allowance resulting from the TiVo Acquisition . In connection with the TiVo Acquisition , a deferred tax liability was recorded for finite-lived intangible assets as described in Note 2. These deferred tax liabilities are considered a source of future taxable income which allowed TiVo Corporation to reduce its pre-acquisition deferred tax asset valuation allowance. The change in the pre-acquisition deferred tax asset valuation allowance is a transaction recognized separate from the business combination and reduces income tax expense in the period of the business combination. As of December 31, 2015 , the deferred tax asset valuation allowance was $449.7 million . During the nine months ended September 30, 2016 , material changes to the deferred tax asset valuation allowance include the $88.1 million decrease in the pre-acquisition deferred tax asset valuation allowance described above and $51.9 million assumed in the TiVo Acquisition . Components of Income tax (benefit) expense were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Release of deferred tax asset valuation allowance $ (88,138 ) $ — $ (88,138 ) $ — Foreign withholding tax 3,316 4,080 9,759 10,737 State income tax (benefit) expense 140 (229 ) 263 (2,411 ) Foreign income tax 934 649 1,771 1,775 Change in net deferred tax liabilities 303 (65 ) 1,224 3,568 Change in unrecognized tax benefits — (727 ) 296 (745 ) Income tax (benefit) expense $ (83,445 ) $ 3,708 $ (74,825 ) $ 12,924 As of December 31, 2015 , the Company had recorded deferred tax assets for the tax effects of the following gross tax loss carryforwards (in thousands): Carryforward Amount Years of Expiration Federal (1) $ 1,155,486 2020 - 2033 State (2) $ 821,952 2017 - 2033 (1) Includes $180.0 million related to stock option deductions that are not included in deferred tax assets. (2) Includes $27.4 million related to stock option deductions that are not included in deferred tax assets. As of December 31, 2015 , the Company's deferred tax asset related to U.S. federal net operating loss carryforwards from continuing operations was $292.7 million . A full valuation allowance has been applied against U.S. federal net operating loss carryforwards. As of December 31, 2015 , the Company's deferred tax asset related to state net operating loss carryforwards from continuing operations was $46.0 million . A valuation allowance of $39.9 million has been applied against state net operating loss carryforwards as of December 31, 2015 . The Company believes it has provided adequate reserves for all tax deficiencies or reductions in tax benefits that could result from federal, state and foreign tax audits. The Company regularly assesses potential outcomes of these audits in order to determine the appropriateness of its tax provision. Adjustments to liabilities for unrecognized tax benefits are made to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular income tax audit. However, income tax audits are inherently unpredictable and there can be no assurance that the Company will accurately predict the outcome of these audits. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously recognized, and therefore the resolution of one or more of these uncertainties in any particular period could have a material adverse impact on the Condensed Consolidated Financial Statements . |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Reportable segments are identified based on the Company's organizational structure and information reviewed by the Company’s chief operating decision maker ("CODM") to evaluate performance and allocate resources. The Company's operations are organized into two reportable segments for financial reporting purposes: Intellectual Property Licensing and Product . The Intellectual Property Licensing segment consists primarily of licensing our patent portfolio to multi-channel video service providers (e.g., cable, satellite and internet-protocol television), set-top box manufacturers, interactive television software and program guide providers in the online, over-the-top video and mobile phone businesses and consumer electronics (“CE”) manufacturers. The Product segment consists primarily of the licensing of Company-developed IPG products and services provided for multi-channel video service providers and CE manufacturers, in-guide advertising revenue, analytics revenue and revenue from licensing the TiVo service, metadata and selling TiVo-enabled DVRs. The Product segment also includes sales of legacy Analog Content Protection, VCR Plus+, connected platform and media recognition products. Segment results are derived from the Company's internal management reporting system. The accounting policies used to derive segment results are substantially the same as those used by the consolidated company. Intersegment revenues and expenses have been eliminated from segment financial information as transactions between reportable segments are excluded from the measure of segment profitability reviewed by the CODM. In addition, certain costs are not allocated to the segments as they are considered Corporate costs. Corporate costs primarily include general and administrative costs such as corporate management, finance, legal and human resources. The CODM uses an Adjusted EBITDA (as defined below) measure to evaluate the performance of, and allocate resources to, the segments. Segment balance sheets are not used by the CODM to allocate resources or assess performance. Segment results were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Intellectual Property Licensing Service Provider $ 66,684 $ 45,890 $ 162,791 $ 144,344 Consumer Electronics 15,139 11,630 43,011 47,927 Revenues 81,823 57,520 205,802 192,271 Adjusted Operating Expenses (1) 19,349 15,515 51,203 47,535 Adjusted EBITDA (2) 62,474 42,005 154,599 144,736 Product Service Provider 59,389 48,117 162,480 149,440 Consumer Electronics 9,153 5,825 18,010 16,586 Other 2,756 3,420 10,458 18,430 Revenues 71,298 57,362 190,948 184,456 Adjusted Operating Expenses (1) 59,807 45,811 150,957 146,959 Adjusted EBITDA (2) 11,491 11,551 39,991 37,497 Corporate: Adjusted Operating Expenses (1) 14,151 11,907 38,406 38,472 Adjusted EBITDA (2) (14,151 ) (11,907 ) (38,406 ) (38,472 ) Consolidated: Revenues 153,121 114,882 396,750 376,727 Adjusted Operating Expenses (1) 93,307 73,233 240,566 232,966 Adjusted EBITDA (2) 59,814 41,649 156,184 143,761 Depreciation 4,622 4,280 13,181 13,098 Amortization of intangible assets 24,925 19,189 63,087 57,789 Restructuring and asset impairment charges 22,311 218 24,644 1,757 Equity-based compensation 13,676 8,328 32,031 31,044 Transaction, transition and integration costs 13,996 — 20,039 — Earnout amortization and settlement 319 (860 ) 1,508 (860 ) Contested proxy election costs — — — 4,346 Change in franchise tax reserve — — 154 — Operating (loss) income from continuing operations (20,035 ) 10,494 1,540 36,587 Interest expense (11,021 ) (11,348 ) (32,411 ) (35,421 ) Interest income and other, net 353 586 322 1,089 Income (loss) on interest rate swaps 1,697 (11,787 ) (16,897 ) (17,106 ) Loss on debt extinguishment — (2,695 ) — (2,815 ) Loss from continuing operations before income taxes $ (29,006 ) $ (14,750 ) $ (47,446 ) $ (17,666 ) (1) Adjusted Operating Expenses is defined as operating expenses excluding depreciation, amortization of intangible assets, restructuring and asset impairment charges, equity-based compensation, transaction, transition and integration expenses, retention earn-outs payable to former shareholders of acquired businesses, changes in contingent consideration, earn-out settlements, contested proxy election costs and changes in franchise tax reserves. (2) Adjusted EBITDA is defined as operating income excluding depreciation, amortization of intangible assets, restructuring and asset impairment charges, equity-based compensation, transaction, transition and integration expenses, retention earn-outs payable to former shareholders of acquired businesses, changes in contingent consideration, earn-out settlements, contested proxy election costs and changes in franchise tax reserves. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On October 12, 2016 , TiVo Solutions repaid $229.95 million of the par value of the 2021 Convertible Notes described in Note 8. In October 2016, TiVo Solutions received $6.4 million from the counterparties to settle the remaining convertible note hedge transactions related to the 2021 Convertible Notes described in Note 8. In October 2016, TiVo Solutions paid $2.9 million to the counterparties to settle the remaining warrants related to the 2021 Convertible Notes . In October 2016, Rovi settled Dolby's demands for unpaid royalties as described in Note 9 for $5.0 million . On November 2, 2016 , TiVo Corporation 's Board of Directors authorized the repurchase of up to $50.5 million of the Company's common stock. The new authorization amount was the remaining amount of Rovi 's prior common stock repurchase authorization, which is no longer in effect. On November 3, 2016, TiVo Corporation announced that it and Samsung Electronics Co., Ltd. had agreed on the principal terms of a five-plus year global intellectual property license that will provide certain rights under TiVo’s patent portfolios for Samsung’s mobile, consumer electronic and set-top box businesses. As part of the agreement, all pending litigation and patent challenges between the two companies described in Note 9 will be stayed and, upon satisfaction of certain conditions during the fourth quarter of 2016, dismissed. |
Basis of Presentation and Sig21
Basis of Presentation and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business On April 28, 2016 , Rovi Corporation (" Rovi ") and TiVo Inc. (renamed TiVo Solutions Inc. (" TiVo Solutions ")) entered into an Agreement and Plan of Merger (the “Merger Agreement”) for Rovi to acquire TiVo Solutions in a cash and stock transaction (the " TiVo Acquisition "). Following consummation of the TiVo Acquisition on September 7, 2016 (the " TiVo Acquisition Date "), TiVo Corporation (the "Company"), a Delaware corporation founded in April 2016 under the name “Titan Technologies Corporation” and then a wholly-owned subsidiary of Rovi , owns both Rovi and TiVo Solutions . The common stocks of Rovi and TiVo Solutions were de-registered after completion of the TiVo Acquisition . The Company provides innovative products and licensable technologies that enable the world’s leading media and entertainment companies to deliver the ultimate entertainment experience and improve how people find content across a changing media landscape. The Company's broad set of content discovery solutions includes interactive program guides (“IPGs”), the TiVo Service and TiVo-enabled digital video recorders ("DVRs"), natural language conversational voice and text search and recommendation services and our extensive database of "Metadata" (i.e., descriptive information, promotional images or other content that describes or relates to television shows, videos, movies, music, books, games or other entertainment content). The Company also offers advertising and a portfolio of data and analytics products including advertising and programming promotion optimization that enable audience targeting in traditional pay TV advertising along with subscriber and operator analytic and insight products that service providers can use to unlock the usage patterns and behaviors of pay TV subscribers. The Company's solutions are deployed globally in the cable, satellite, consumer electronics, entertainment, media and online distribution markets. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation Rovi is the predecessor registrant to TiVo Corporation and therefore, for periods prior to September 7, 2016 , the Condensed Consolidated Financial Statements reflect the financial position and results of operations and cash flows of Rovi . As used herein, the “Company” refers to Rovi when referring to periods prior to September 7, 2016 and to TiVo Corporation when referring to periods subsequent to September 7, 2016 . The Company’s results of operations include the operations of TiVo Solutions after September 7, 2016 . See Note 2 for additional information on the TiVo Acquisition . The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been condensed or omitted in accordance with such rules and regulations. However, the Company believes the disclosures made are adequate to make the information presented herein not misleading. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements reflect all adjustments, consisting only of normal recurring adjustments, which in the opinion of management, are considered necessary to present fairly the results for the periods presented. The information contained in this Quarterly Report on Form 10-Q should be read in conjunction with the audited financial statements and notes thereto and other disclosures contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 . The Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Cash Flows for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2016 , for any future year, or for any other future interim period. The accompanying Condensed Consolidated Financial Statements include the accounts of TiVo Corporation and subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary after the elimination of intercompany accounts and transactions. Certain prior year amounts have been reclassified to conform to the current year presentation. |
Use of Estimates | Use of Estimates The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and related disclosures at the date of the financial statements and the reported results of operations for the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, long-lived asset impairment, including goodwill and intangible assets, equity-based compensation and income taxes. Actual results may differ from those estimates. |
Cash and Cash Equivalents | Cash and cash equivalents Highly liquid investments with original maturities at the date of acquisition of three months or less are considered to be cash equivalents. The majority of payments due from banks for third-party credit card, debit card, and electronic benefit transactions (EBT) process within 24-72 hours, except for transactions occurring on a Friday, which are generally processed the following Monday. All credit card, debit card and EBT transactions that process in less than three days are classified as cash and cash equivalents. Payments due from banks for these transactions presented in Cash and cash equivalents was $0.8 million as of September 30, 2016 . |
Inventory | Inventory Inventories consist primarily of finished DVR units and accessories and are stated at the lower of cost or market. Cost is computed using standard cost, which approximates actual cost on a first-in, first-out basis. Adjustments to reduce the cost of inventory to the lower of cost or market are made, if required, for estimated excess or obsolescence, which includes a review of, among other factors, demand requirements and market conditions. |
Revenue Recognition | Revenue Recognition Patent Sales During 2016, the Company expanded its business strategy of monetizing its intellectual property to include the sale of select patent assets. As patent sales executed under this strategy represent a component of the Company's ongoing major or central operations and activities of monetizing intellectual property, the related proceeds from patent sales are now recognized as revenue. Revenue from patent sales is recognized when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred and collectibility is reasonably assured. These requirements are generally fulfilled on closing of the patent sale transaction. Revenue for the three and nine months ended September 30, 2016 includes $0.3 million and $0.8 million , respectively, related to patent sales. Sources of Revenue of TiVo Solutions The Company's TiVo Solutions subsidiary generates service revenues, hardware revenues (in some instances), and technology revenues by providing the traditional TiVo service through agreements with satellite and cable television service providers and broadcasters. Through our subsidiary, Cubiware Sp. Z.o.o. ("Cubiware"), TiVo Solutions offers a solution for Pay-TV Operators in developing and emerging markets around the world. Through our subsidiary Digitalsmiths Corporation, we provide a cloud-based search and recommendation services for the Pay-TV industry. TiVo Solutions generates revenue through both recurring and upfront service fees through sale of TiVo service subscriptions to consumers and through the sale of TiVo devices by third-party retailers and through the online store at TiVo.com. Through our subsidiary TiVo Research and Analytics, Inc., we also generate revenues through the sale of cross-platform audience research data by providing data analytics solutions for the television industry. TiVo-Owned Business: TiVo-enabled DVRs and TiVo service 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 the product for one upfront payment (prepaid program). In the case of the monthly program, after the initial committed subscription term, the customers have various pricing options at which they can renew the subscription. Vendor-specific objective evidence ("VSOE") of selling price for the subscription services is established based on standalone sales of the service and varies by service period. The Company is not able to obtain VSOE for the DVR element due to infrequent sales of standalone DVRs to consumers. The best-estimate of selling price ("BESP") of the DVR is established based on the price at which the Company would sell the DVR without any service commitment from the customer. Under these bundled programs, revenue is allocated between hardware revenue for the DVR and service revenue for the subscription on a relative selling price basis, with the DVR revenue recognized upon delivery, up to an amount not contingent on future service delivery, and the subscription revenue is recognized over the term of the service. Subscription revenues from product lifetime subscriptions are recognized ratably over the Company's estimate of the useful life of a TiVo-enabled DVR associated with the subscription. The estimates of expected lives are dependent on assumptions with regard to future churn of product lifetime subscriptions. The Company continuously monitors the useful life of a TiVo-enabled DVR and the impact of the difference between actual churn and forecasted churn rates. If actual results are not consistent with the Company's current assumptions, including a higher churn rate for product lifetime subscriptions due to the incompatibility of TiVo's standard definition units with high definition programming and increased competition, the Company may revise the estimated life of the units which could result in the recognition of revenue over a longer or shorter period. The Company recognizes product lifetime subscription revenues over an estimated product life of 66 months. End users have the right to cancel their subscriptions to the TiVo service within 30 days of subscription activation for a full refund. TiVo establishes allowances for expected subscription cancellations. TiVo Arrangements with Multiple System Operators ("MSOs") The Company has two different types of arrangements with MSOs that include technology deployment and engineering services. The Company's arrangements with MSOs typically include software customization and set up services, limited training, post contract support ("PCS"), TiVo-enabled DVRs, non-DVR set-top boxes ("STBs"), and TiVo service. In instances where TiVo hosts the TiVo service, the Company recognizes revenue under the general revenue recognition guidance. The Company determines whether evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collection is reasonably assured. Revenue recognition is deferred until such time as all of the criteria are satisfied. Elements in such arrangements usually include DVRs, non-DVR STBs, TiVo service hosting, associated maintenance, and support and training. Non-refundable payments received for customization and set up services are deferred and recognized as revenue over the period the services are expected to be provided (the longer of the contractual term or customer relationship period) as the upfront services do not have standalone value. The related cost of such services is capitalized to the extent it is deemed recoverable and amortized to cost of revenues over the same period as the related revenue. The Company has 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 determined considering the size of the MSO and expected volume of deployment, market conditions, competitive landscape, internal costs and total gross margin objectives. Total arrangement consideration (other than fees for customization and set up services which are allocated to the ongoing hosting services) is allocated among individual elements on a relative basis. In arrangements where the Company does not host the TiVo service and that include engineering services that are essential to the functionality of the licensed technology or involve significant customization or modification of the software, the Company recognizes revenue under industry specific software revenue recognition guidance. Under the software revenue recognition guidance, such arrangements are accounted for using the percentage-of-completion method or the completed-contract method. The percentage-of-completion method is used if the Company believes it is able to make reasonably dependable estimates of the extent of progress toward completion and the arrangement as a whole is reasonably expected to be profitable. The Company measures progress toward completion using an input method based on the ratio of costs incurred, principally labor, to date to total estimated costs of the project. These estimates are reassessed during the term of the arrangement, and revisions to estimates are recognized on a cumulative catch-up basis when the changed conditions become known. In some cases, it may not be possible to separate the various elements within the arrangement due to a lack of VSOE of selling prices for undelivered elements in the contract or because of the lack of reasonably dependable estimates of total costs or development costs exceed development revenues but the Company is reasonably assured that no loss will be incurred under the arrangement. Accordingly, the Company applies the following: • Where no VSOE exists for undeliverable elements, revenue is recognized at zero margin up to the amount billable until the Company has established VSOE for the undelivered elements or the Company has delivered all of the elements. • Where there is a lack of reasonably dependable estimates, revenue is recognized at zero margin up to the amount billable until the Company has resolved the estimation uncertainty, after which the Company recognizes margin under the percentage of completion method. • If the Company cannot be reasonably assured that no loss will be incurred under the arrangement, the Company will account for the arrangement under the completed contract method, which results in a full deferral of the revenue and costs until the project is complete. Provisions for losses are recorded when estimates indicate that a loss will be incurred on the arrangement. Where development costs exceed billable development revenues provided that the Company is reasonably assured that no loss will be incurred under the arrangement, the Company recognizes revenues and costs based at zero margin, which results in the recognition of equal amounts of revenues and costs until the engineering professional services are complete. Development costs incurred in excess of revenues recognized are deferred up to the amount deemed recoverable. Thereafter, as the Company recognizes revenue from the MSO arrangement for services, an equal amount of deferred development costs is recognized until all deferred development costs are recovered. Afterwards, any additional MSO service revenue is recognized as service revenue. Software Revenues Software revenues represent revenues from licenses of Cubiware software and amounts allocated to software elements in multiple element arrangements. These license arrangements are with operators or resellers who integrate our software in set top boxes manufactured by the operators or resellers. Revenues are generally recognized on shipment of the set top boxes in which the software is integrated, provided that all fees are fixed or determinable, evidence of an arrangement exists, and collectibility is reasonably assured. Hardware Revenues Hardware revenues represent revenues from standalone hardware sales and amounts allocated to hardware elements in multiple element arrangements. Revenues are recognized upon product shipment to the customers or receipt of the products by the customer, depending on the shipping terms, provided that all fees are fixed or determinable, evidence of an arrangement exists, and collectibility is reasonably assured. End users have the right to return their product within 30 days of the purchase. The Company establishes allowances for expected product and service returns and these allowances are recorded as a direct reduction of revenues and accounts receivable. Certain payments to retailers and distributors such as market development funds and revenue share are recorded as a reduction of hardware revenues rather than as a sales and marketing expense. The Company's policy for revenue share payments is to reduce revenue when these payments are incurred and fixed or determinable. The Company reduces revenue at the later of the date at which the related hardware revenue is recognized or the date at which the market development program is offered. |
Warranty Expense | Warranty Expense The Company accrues for the expected material and labor costs required 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 or repair the customers’ product returns under warranty. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Standards Recently Adopted In April 2015, the Financial Accounting Standards ("FASB") issued guidance to help entities evaluate whether fees paid in a cloud computing arrangement include a software license. Pursuant to this guidance, when a cloud computing arrangement includes a software license, the customer accounts for the software license element of the arrangement consistent with the acquisition of other software licenses. When a cloud computing arrangement does not include a software license element, the customer accounts for the arrangement as a service contract. The prospective application of this guidance on January 1, 2016 did not have a material effect on the Condensed Consolidated Financial Statements . Standards Pending Adoption In August 2016, the FASB issued clarifying guidance on the presentation of eight specific cash flow issues for which previous guidance was either unclear or was not specific. The clarified guidance is effective for the Company in the first quarter of 2018, with early application permitted, and is required to be applied on a retrospective basis. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In June 2016, the FASB issued updated guidance that requires entities to use a current expected credit loss model to measure credit-related impairments for financial instruments held at amortized cost. The current expected credit loss model is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect collectibility. Current expected credit losses, and subsequent adjustments, represent an estimate of lifetime expected credit losses that are recorded as an allowance deducted from the amortized cost basis of the financial instrument. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments for credit-related losses through an allowance and eliminating the length of time a security has been in an unrealized loss position as a consideration in the determination of whether a credit loss exists. The guidance is effective for the Company in the first quarter of 2020, and is effective using a modified retrospective approach for application of the current expected credit loss model to financial instruments and a prospective approach for credit losses on available-for-sale debt securities. Early application is permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In March 2016, the FASB simplified certain areas of accounting for stock-based compensation, including accounting for the income tax consequences of stock-based compensation, determining the classification of awards as either equity or liabilities, classifying certain items within the statement of cash flows and introducing an accounting policy election to account for forfeitures of nonvested awards as they occur. The simplified guidance is effective for the Company in the first quarter of 2017. Depending on the area simplified, the guidance is effective either prospectively, retrospectively or using a modified retrospective approach. Early application is permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In March 2016, the FASB clarified the requirements for assessing whether contingent options that can accelerate the payment of principal on debt instruments require bifurcation as an embedded derivative. The amendments require a contingent option embedded in a debt instrument to be evaluated for possible separate accounting as a derivative instrument without regard to the nature of the exercise contingency. The clarified guidance is effective for the Company in the first quarter of 2017 using a modified retrospective approach with early application permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In February 2016, the FASB issued a new accounting standard for leases. The new standard generally requires the recognition of financing and operating lease liabilities and corresponding right-of-use assets on the balance sheet. For financing leases, a lessee recognizes amortization of the right-of-use asset as an operating expense over the lease term separately from interest on the lease liability. For operating leases, a lessee recognizes its total lease expense as an operating expense over the lease term. The amendments are effective for the Company in the first quarter of 2019 using a modified retrospective approach with early application permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements and expects that its existing operating lease commitments will be recognized as operating lease liabilities and right-of-use assets. In January 2016, the FASB amended certain aspects of the recognition and measurement guidance for financial assets and liabilities. The amendments are effective for the Company in the first quarter of 2018 with the effect of adoption recognized as a cumulative-effect adjustment to beginning retained earnings in 2018. Early application is not permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In July 2015, the FASB changed the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value for entities that do not use the last-in, first-out ("LIFO") or retail inventory method. The changes also eliminate the requirement to consider replacement cost or net realizable value less an approximately normal profit margin when measuring inventory for entities that do not use the LIFO or retail inventory method. The changes are effective for the Company in the first quarter of 2017 using a prospective transition approach, with early adoption permitted. The Company is evaluating the effect of application on its Condensed Consolidated Financial Statements . In May 2014, the FASB issued an amended accounting standard for revenue recognition. The amendments address how revenue is recognized in order to improve comparability between the financial statements of companies applying U.S. GAAP and International Financial Reporting Standards. The core principle of the amended standard is for an entity to recognize revenue to depict the transfer of promised goods or services to customers in amounts that reflect the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments are effective for the Company in the first quarter of 2018 and may be applied using a full retrospective or modified retrospective approach. Early application is permitted beginning in the Company's first quarter of 2017. The Company is evaluating the effect the amendments and transition alternatives will have on its Condensed Consolidated Financial Statements . |
Fair Value Hierarchy | Fair Value Hierarchy The Company uses valuation techniques that are based on observable and unobservable inputs to measure fair value. Observable inputs are developed using publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Fair value measurements are classified in a hierarchy that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement in its entirety: 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. |
Basis of Presentation and Sig22
Basis of Presentation and Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Customers and Concentration of Customers | The percent of revenue derived from customers, and concentrations of customers, representing more than 10% of revenue were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 AT&T Inc. ("AT&T") 13 % 14 % 13 % 13 % Charter Communications Inc. ("Charter") (1) 11 % 11 % 10 % (1) Customer represented less than 10% of revenue. Substantially all of the Company's revenue from AT&T and a significant portion of the Company's revenue from Charter is reported in the Intellectual Property Licensing segment. Customers representing more than 10% of Accounts receivable, net were as follows. September 30, 2016 December 31, 2015 AT&T 15 % 22 % Virgin Media Inc. 14 % (1) DISH Network L.L.C. ("DISH") 12 % (1) (1) Customer represented less than 10% of Accounts receivable, net . |
TiVo Acquisition (Tables)
TiVo Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Purchase Price Allocation | The following table summarizes the preliminary purchase price allocation as of September 30, 2016 (in thousands): Cash, cash equivalents and marketable securities $ 503,408 Accounts receivable 48,766 Inventory 15,003 Prepaid expenses and other current assets and other long-term assets 25,976 Property and equipment 10,370 Intangible assets: Developed technology and patents 154,000 Existing contracts and customer relationships 355,000 Trademarks / Tradenames 14,000 Goodwill 464,111 Accounts payable and accrued expenses and other long-term liabilities (74,736 ) Deferred revenue (63,428 ) Current portion of long-term debt (230,000 ) Deferred tax liabilities, net (92,744 ) Total merger consideration $ 1,129,726 The preliminary aggregate merger consideration was (in thousands): Aggregate cash consideration $ 269,990 Aggregate fair value of TiVo Corporation shares issued 751,385 Fair value of assumed TiVo Solutions employee stock-based awards allocated to consideration 22,640 Accrual for merger consideration 85,711 Total merger consideration $ 1,129,726 |
Pro Forma Information | The unaudited pro forma condensed combined financial information is not intended to represent or be indicative of the results of operations that would have been reported had the TiVo Acquisition occurred on January 1, 2015 and should not be taken as representative of future results of operations of the combined company. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Revenues, net: $ 208,690 $ 215,281 $ 616,137 $ 655,029 Income (loss) from continuing operations, net of tax $ (35,380 ) $ (45,395 ) $ (120,633 ) $ (123,081 ) Basic income (loss) per share from continuing operations $ (0.28 ) $ (0.39 ) $ (1.02 ) $ (1.03 ) Diluted income (loss) per share from continuing operations $ (0.28 ) $ (0.39 ) $ (1.02 ) $ (1.03 ) |
Financial Statement Details (Ta
Financial Statement Details (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net (in thousands): September 30, 2016 December 31, 2015 Accounts receivable, gross $ 147,388 $ 88,735 Less: Allowance for doubtful accounts (1,658 ) (1,607 ) Accounts receivable, net $ 145,730 $ 87,128 |
Schedule of Inventory | Inventory (in thousands): September 30, 2016 December 31, 2015 Raw materials $ 2,165 $ — Finished goods 12,034 456 Inventory $ 14,199 $ 456 |
Property and Equipment, Net | Property and equipment, net (in thousands): September 30, 2016 December 31, 2015 Computer software and equipment $ 130,075 $ 133,631 Leasehold improvements 25,143 21,578 Furniture and fixtures 7,513 7,676 Property and equipment, gross 162,731 162,885 Less: Accumulated depreciation and amortization (119,217 ) (127,901 ) Property and equipment, net $ 43,514 $ 34,984 |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses (in thousands): September 30, 2016 December 31, 2015 Accounts payable $ 32,739 $ 9,013 Accrued compensation and benefits 43,387 27,056 Accrual for merger consideration 85,711 — Other accrued liabilities 72,877 38,044 Accounts payable and accrued expenses $ 234,714 $ 74,113 |
Supplemental Cash Flow Information | Supplemental Cash Flow Information (in thousands): Nine Months Ended September 30, 2016 2015 Significant noncash transactions Fair value of shares issued in connection with TiVo Acquisition $ 751,385 $ — |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Investments [Abstract] | |
Available-For-Sale And Other Investment Securities | The amortized cost and fair value of cash, cash equivalents and marketable securities by significant investment category were as follows (in thousands): September 30, 2016 Amortized Cost Unrealized Unrealized Fair Value Cash $ 162,282 $ — $ — $ 162,282 Cash equivalents - Money market funds 220,334 — — 220,334 Cash and cash equivalents $ 382,616 $ — $ — $ 382,616 Auction rate securities $ 10,800 $ — $ (432 ) $ 10,368 Corporate debt securities 104,367 57 (88 ) 104,336 Foreign government obligations 6,648 — (3 ) 6,645 U.S. Treasuries / Agencies 115,865 46 (105 ) 115,806 Marketable securities $ 237,680 $ 103 $ (628 ) $ 237,155 Cash, cash equivalents and marketable securities $ 619,771 December 31, 2015 Amortized Cost Unrealized Unrealized Fair Value Cash $ 56,745 $ — $ — $ 56,745 Cash equivalents - Money market funds 44,930 — — 44,930 Cash and cash equivalents $ 101,675 $ — $ — $ 101,675 Auction rate securities $ 10,800 $ — $ (540 ) $ 10,260 Corporate debt securities 98,997 — (327 ) 98,670 Foreign government obligations 11,878 — (56 ) 11,822 U.S. Treasuries / Agencies 102,120 5 (283 ) 101,842 Marketable securities $ 223,795 $ 5 $ (1,206 ) $ 222,594 Cash, cash equivalents and marketable securities $ 324,269 |
Available-For-Sale Debt Investments At Fair Value | As of September 30, 2016 , the amortized cost and fair value of marketable securities, by contractual maturity, were as follows (in thousands): Amortized Cost Fair Value Due in less than 1 year $ 121,227 $ 121,221 Due in 1-2 years 105,653 105,566 Due in more than 2 years 10,800 10,368 Total $ 237,680 $ 237,155 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Assets And Liabilities Measured And Recorded At Fair Value On A Recurring Basis | Assets and liabilities reported at fair value on a recurring basis in the Condensed Consolidated Balance Sheets were classified in the fair value hierarchy as follows (in thousands): September 30, 2016 Total Quoted Prices in Significant Other Significant Assets Cash and cash equivalents Money market funds $ 220,334 $ 220,334 $ — $ — Short-term marketable securities Corporate debt securities 72,084 — 72,084 — Foreign government obligations 6,645 — 6,645 — U.S. Treasuries / Agencies 42,492 — 42,492 — Long-term marketable securities Auction rate securities 10,368 — — 10,368 Corporate debt securities 32,252 — 32,252 — U.S. Treasuries / Agencies 73,314 — 73,314 — Total Assets $ 457,489 $ 220,334 $ 226,787 $ 10,368 Liabilities Accounts payable and accrued expenses Cubiware contingent consideration $ (4,091 ) $ — $ — $ (4,091 ) Interest rate swaps (1,483 ) — (1,483 ) — Other long-term liabilities Cubiware contingent consideration (3,518 ) — — (3,518 ) Interest rate swaps (33,986 ) — (33,986 ) — Total Liabilities $ (43,078 ) $ — $ (35,469 ) $ (7,609 ) December 31, 2015 Total Quoted Prices in Significant Other Significant Assets Cash and cash equivalents Money market funds $ 44,930 $ 44,930 $ — $ — Short-term marketable securities Corporate debt securities 43,876 — 43,876 — Foreign government obligations 7,827 — 7,827 — U.S. Treasuries / Agencies 56,176 — 56,176 — Long-term marketable securities Auction rate securities 10,260 — — 10,260 Corporate debt securities 54,794 — 54,794 — Foreign government obligations 3,995 — 3,995 — U.S. Treasuries / Agencies 45,666 — 45,666 — Total Assets $ 267,524 $ 44,930 $ 212,334 $ 10,260 Liabilities Accounts payable and accrued expenses Interest rate swaps $ (195 ) $ — $ (195 ) $ — Other long-term liabilities Interest rate swaps (25,557 ) — (25,557 ) — Total Liabilities $ (25,752 ) $ — $ (25,752 ) $ — |
Summary Of Level 3 Auction Rate Securities | Changes in the fair value of assets and liabilities classified in Level 3 of the fair value hierarchy were as follows (in thousands): Three Months Ended September 30, 2016 2015 Auction rate securities Cubiware contingent consideration Auction rate securities Veveo contingent consideration Balance at beginning of period $ 10,260 $ — $ 10,584 $ (860 ) Assumed in TiVo Acquisition — (7,542 ) — — Gain (loss) included in earnings — (67 ) — 860 Unrealized gains (losses) included in other comprehensive (loss) income 108 — (108 ) — Balance at end of period $ 10,368 $ (7,609 ) $ 10,476 $ — Nine Months Ended September 30, 2016 2015 Auction rate securities Cubiware contingent consideration Auction rate securities IntegralReach contingent consideration Veveo contingent consideration Balance at beginning of period $ 10,260 $ — $ 10,638 $ (3,000 ) $ (3,000 ) Settlements — — — 3,000 2,140 Assumed in TiVo Acquisition — (7,542 ) — — — Gain (loss) included in earnings — (67 ) — — 860 Unrealized gains (losses) included in other comprehensive (loss) income 108 — (162 ) — — Balance at end of period $ 10,368 $ (7,609 ) $ 10,476 $ — $ — |
Outstanding Debt Fair Value | The carrying amount and fair value of debt issued or assumed by the Company were as follows (in thousands): September 30, 2016 December 31, 2015 Carrying Amount Fair Value (1) Carrying Amount Fair Value (1) 2021 Convertible Notes $ 230,000 $ 230,000 $ — $ — 2020 Convertible Notes 294,229 359,042 284,241 298,494 Term Loan Facility B 678,504 685,105 682,915 656,688 Total $ 1,202,733 $ 1,274,147 $ 967,156 $ 955,182 (1) The fair value of debt issued 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. |
Goodwill And Intangible Asset27
Goodwill And Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill Activity | Goodwill allocated to the reportable segments and changes in the carrying amount of goodwill by reportable segment were as follows (in thousands): Intellectual Property Licensing Product Total December 31, 2015 $ 1,184,500 $ 159,152 $ 1,343,652 TiVo Acquisition 106,566 357,545 464,111 Foreign currency translation — 860 860 September 30, 2016 $ 1,291,066 $ 517,557 $ 1,808,623 |
Summary of Intangible Assets | Intangible assets, net consisted of the following (in thousands): September 30, 2016 Weighted-Average Remaining Useful Life Gross Accumulated Net Finite-lived intangible assets Developed technology and patents 5.8 years $ 1,031,687 $ (564,495 ) $ 467,192 Existing contracts and customer relationships 11.0 years 402,524 (45,154 ) 357,370 Content databases and other 6.3 years 59,688 (48,719 ) 10,969 Trademarks / Tradenames N/A 8,300 (8,300 ) — Total Finite-lived 1,502,199 (666,668 ) 835,531 Indefinite-lived intangible assets TiVo Tradename N/A 14,000 — 14,000 Total intangible assets $ 1,516,199 $ (666,668 ) $ 849,531 December 31, 2015 Gross Accumulated Net Finite-lived intangible assets Developed technology and patents $ 875,188 $ (512,060 ) $ 363,128 Existing contracts and customer relationships 47,524 (36,933 ) 10,591 Content databases and other 59,014 (45,991 ) 13,023 Trademarks / Tradenames 8,300 (8,300 ) — Total intangible assets $ 990,026 $ (603,284 ) $ 386,742 |
Estimated Amortization Expense In Future Periods | As of September 30, 2016 , future estimated amortization expense for finite-lived intangible assets was as follows (in thousands): Remainder of 2016 $ 41,932 2017 166,214 2018 146,794 2019 109,345 2020 108,579 Thereafter 262,667 Total $ 835,531 |
Restructuring and Asset Impai28
Restructuring and Asset Impairment Charges (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Asset Impairment Charges | Components of all Restructuring and asset impairment charges were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Future minimum lease payments, net $ — $ 435 $ 214 $ 1,934 Severance costs 7,580 (217 ) 7,968 (177 ) Share-based payments 14,731 — 14,731 — Contract termination costs — — 1,279 — Asset impairment — — 452 — Restructuring and asset impairment charges $ 22,311 $ 218 $ 24,644 $ 1,757 Accrued restructuring costs for all plans were as follows (in thousands): September 30, 2016 December 31, 2015 Future minimum lease payments, net $ 655 $ 2,015 Severance costs 6,975 250 Contract termination costs 120 — Accrued restructuring costs $ 7,750 $ 2,265 |
Restructuring Activities Related to Tivo Corporation Plan | Restructuring activities related to the Q3 2016 TiVo Corporation Restructuring Plan for the three and nine months ended September 30, 2016 were as follows (in thousands): Balance at Beginning of Period Restructuring Expense Cash Settlements Non-Cash Settlements Balance at End of Period Severance $ — $ 7,580 $ (1,599 ) $ — $ 5,981 Share-based payments — 14,731 — (14,731 ) — Total $ — $ 22,311 $ (1,599 ) $ (14,731 ) $ 5,981 |
Debt and Interest Rate Swaps (T
Debt and Interest Rate Swaps (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Instrument [Line Items] | |
Carrying Value and Par Value of Debt | A summary of the Company's financing arrangements was as follows (dollars in thousands): September 30, 2016 December 31, 2015 Stated Interest Rate Issue Date Maturity Date Outstanding Principal Carrying Amount Outstanding Principal Carrying Amount 2021 Convertible Notes 2.000% September 22, 2014 October 1, 2021 $ 230,000 $ 230,000 $ — $ — 2020 Convertible Notes 0.500% March 4, 2015 March 1, 2020 $ 345,000 $ 294,229 $ 345,000 $ 284,241 Term Loan Facility B Variable July 2, 2014 July 2, 2021 684,250 678,504 689,500 682,915 Total Long-term debt $ 1,259,250 1,202,733 $ 1,034,500 967,156 Less: Current portion of long-term debt 237,000 7,000 Long-term debt, less current portion $ 965,733 $ 960,156 |
Schedule of Maturities of Long-term Debt | As of September 30, 2016 , aggregate expected future principal payments on long-term debt, including the current portion of long-term debt, were as follows (in thousands): Remainder of 2016 (1) $ 231,750 2017 7,000 2018 7,000 2019 (2) 352,000 2020 7,000 Thereafter 654,500 Total $ 1,259,250 (1) While the 2021 Convertible Notes are scheduled to mature on October 1, 2021 and can be freely converted by holders beginning on July 1, 2021 , future principal payments are presented based on the date holders can require TiVo Solutions to repurchase the 2021 Convertible Notes . Rovi 's acquisition of TiVo Solutions constitutes a Fundamental Change under the 2021 Convertible Notes , which requires TiVo Solutions to offer to repurchase the 2021 Convertible Notes at par plus accrued and unpaid interest. On October 12, 2016 , $229.95 million of the 2021 Convertible Notes were repaid. (2) 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. |
Summary of Interest Rate Swaps | Details of the Company's interest rate swaps as of September 30, 2016 and December 31, 2015 were as follows (dollars in thousands): Notional Contract Inception Contract Effective Date Contract Maturity September 30, 2016 December 31, 2015 Interest Rate Paid Interest Rate Received Senior Secured Credit Facility May 2012 January 2014 January 2016 $ — $ 197,000 (1) One month USD-LIBOR May 2012 April 2014 March 2017 $ 215,000 $ 215,000 (2) One month USD-LIBOR 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 (1) The Company paid a fixed interest rate which gradually increased from 0.58% for the three-month settlement period ended in June 2014 to 1.65% for the settlement period ended in January 2016 . (2) The Company pays a fixed interest rate which gradually increases from 0.65% for the three-month settlement period ended in June 2014 to 2.11% for the settlement period ending in March 2017 . |
Convertible Debt [Member] | 2020 Convertible Notes [Member] | |
Debt Instrument [Line Items] | |
Convertible Debt | Related to the 2020 Convertible Notes , the Condensed Consolidated Balance Sheets included the following (in thousands): September 30, 2016 December 31, 2015 Liability component Principal outstanding $ 345,000 $ 345,000 Less: Unamortized debt discount (45,215 ) (54,215 ) Less: Unamortized debt issuance costs (5,556 ) (6,544 ) Carrying amount $ 294,229 $ 284,241 Equity component $ 63,854 $ 63,854 |
Components of Interest Expense | Components of interest expense related to the 2020 Convertible Notes included in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stated interest $ 431 $ 431 $ 1,294 $ 1,006 Amortization of debt discount 3,035 2,897 9,000 6,708 Amortization of debt issuance costs 338 351 988 814 Total interest expense $ 3,804 $ 3,679 $ 11,282 $ 8,528 |
Convertible Debt [Member] | 2040 Convertible Notes [Member] | |
Debt Instrument [Line Items] | |
Components of Interest Expense | Components of interest expense related to the 2040 Convertible Notes included in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stated interest $ — $ — $ — $ 1,114 Amortization of debt discount — — — 1,865 Amortization of debt issue costs — — — 242 Total interest expense $ — $ — $ — $ 3,221 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Payments for Operating Leases | Future minimum payments for operating leases as of September 30, 2016 were as follows (in thousands): Remainder of 2016 $ 4,411 2017 16,869 2018 15,262 2019 13,073 2020 11,464 Thereafter 57,462 Gross future minimum lease payments $ 118,541 Less: Sublease revenues (5,789 ) Net future minimum lease payments $ 112,752 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Schedule of Weighted Average Number of Shares | The number of shares used to calculate Basic EPS and Diluted EPS were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Weighted average shares used in computing basic per share amounts 91,131 82,404 84,895 85,297 Dilutive effect of equity-based compensation awards 1,013 — 963 — Weighted average shares used in computing diluted per share amounts 92,144 82,404 85,858 85,297 |
Weighted Average Potential Anti-Dilutive Common Shares | Weighted average potential shares excluded from the calculation of Diluted EPS as their effect would have been anti-dilutive were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options 3,332 4,124 3,497 4,236 Restricted awards 1,483 2,832 2,176 2,887 2021 Convertible Notes (1) 1,470 — 494 — 2020 Convertible Notes (1) 11,936 11,936 11,936 9,181 2040 Convertible Notes (1) — — — 1,162 Warrants related to 2020 Convertible Notes (1) 11,936 11,936 11,936 9,181 Weighted average potential shares excluded from the calculation of Diluted EPS 30,157 30,828 30,039 26,647 (1) See Note 8 for additional details. |
Changes in Stockholders Equity | Stockholders’ equity as of September 30, 2016 and 2015 and changes in stockholders’ equity during the three months ended September 30, 2016 and 2015 were as follows (in thousands): Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of June 30, 2016 131,888 $ 132 (48,586 ) $ (1,167,575 ) $ 2,445,589 $ (3,544 ) $ (246,511 ) $ 1,028,091 Net income (loss) 49,922 49,922 Foreign currency translation adjustment, net of tax 452 Unrealized (losses) gains on marketable securities, net of tax (282 ) Other comprehensive loss 170 170 Issuance of common stock upon exercise of options 29 — 496 496 Issuance of common stock under employee stock purchase plan 652 1 6,139 6,140 Issuance of restricted stock, net 90 — — — Equity-based compensation 28,421 28,421 Issuance of common stock in connection with TiVo Acquisition 35,838 36 773,989 774,025 Cancellation of treasury stock (48,606 ) (49 ) 48,606 1,167,954 (1,167,905 ) — Stock repurchases (252 ) (5,323 ) (5,323 ) Balances as of September 30, 2016 119,891 $ 120 (232 ) $ (4,944 ) $ 3,254,634 $ (3,374 ) $ (1,364,494 ) $ 1,881,942 Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of June 30, 2015 130,756 $ 131 (43,898 ) $ (1,113,386 ) $ 2,397,069 $ (5,871 ) $ (227,291 ) $ 1,050,652 Net income (loss) (18,458 ) (18,458 ) Foreign currency translation adjustment, net of tax 288 Unrealized (losses) gains on marketable securities, net of tax (20 ) Other comprehensive loss 268 268 Issuance of common stock upon exercise of options 13 — 184 184 Issuance of common stock under employee stock purchase plan 291 — 2,716 2,716 Cancellation of restricted stock, net (22 ) — — — Equity-based compensation 8,328 8,328 Excess tax benefit associated with stock plans 15 15 Stock repurchases (4,492 ) (50,000 ) (50,000 ) Balances as of September 30, 2015 131,038 $ 131 (48,390 ) $ (1,163,386 ) $ 2,408,312 $ (5,603 ) $ (245,749 ) $ 993,705 Stockholders’ equity as of September 30, 2016 and 2015 and changes in stockholders’ equity during the nine months ended September 30, 2016 and 2015 were as follows (in thousands): Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of December 31, 2015 131,052 $ 131 (48,405 ) $ (1,163,533 ) $ 2,419,921 $ (6,503 ) $ (219,451 ) $ 1,030,565 Net income (loss) 22,862 22,862 Foreign currency translation adjustment, net of tax 2,636 Unrealized (losses) gains on marketable securities, net of tax 493 Other comprehensive loss 3,129 3,129 Issuance of common stock upon exercise of options 195 — 3,270 3,270 Issuance of common stock under employee stock purchase plan 1,160 2 10,694 10,696 Issuance of restricted stock, net 252 — — — Equity-based compensation 46,760 46,760 Issuance of common stock in connection with TiVo Acquisition 35,838 36 773,989 774,025 Cancellation of treasury stock (48,606 ) (49 ) 48,606 1,167,954 (1,167,905 ) — Stock repurchases (433 ) (9,365 ) (9,365 ) Balances as of September 30, 2016 119,891 $ 120 (232 ) $ (4,944 ) $ 3,254,634 $ (3,374 ) $ (1,364,494 ) $ 1,881,942 Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balances as of December 31, 2014 130,627 $ 131 (38,898 ) $ (1,013,218 ) $ 2,339,817 $ (5,307 ) $ (215,159 ) $ 1,106,264 Net income (loss) (30,590 ) (30,590 ) Foreign currency translation adjustment, net of tax (230 ) Unrealized (losses) gains on marketable securities, net of tax (66 ) Other comprehensive loss (296 ) (296 ) Issuance of common stock upon exercise of options 85 — 1,478 1,478 Issuance of common stock under employee stock purchase plan 543 — 7,289 7,289 Cancellation of restricted stock, net (217 ) — — — Equity-based compensation 31,044 31,044 Excess tax benefit associated with stock plans 66 66 Equity component related to issuance of 2020 Convertible Notes 63,854 63,854 Equity component related to 2020 Convertible Notes issuance costs (1,737 ) (1,737 ) Issuance of warrants related to 2020 Convertible Notes 31,326 31,326 Purchase of call options related to 2020 Convertible Notes (64,825 ) (64,825 ) Stock repurchases (9,492 ) (150,168 ) (150,168 ) Balances as of September 30, 2015 131,038 $ 131 (48,390 ) $ (1,163,386 ) $ 2,408,312 $ (5,603 ) $ (245,749 ) $ 993,705 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Assumptions Used To Value Equity-Based Payments | Assumptions used to estimate the fair value of equity-based compensation awards granted during the period were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options: Expected volatility 55.5 % N/A 55.7 % 45.0 % Expected term 4.1 years N/A 4.1 years 4.0 years Risk-free interest rate 0.9 % N/A 1.1 % 1.3 % Expected dividend yield 0.0 % N/A 0.0 % 0.0 % ESPP shares: Expected volatility 50.4 % 56.0 % 55.6 % 53.0 % Expected term 1.3 years 1.3 years 1.3 years 1.3 years Risk-free interest rate 0.5 % 0.4 % 0.6 % 0.4 % Expected dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Restricted stock units subject to market conditions: Expected volatility 55.9 % N/A 55.9 % 41.0 % Expected term 2.7 years N/A 3.0 years 3.0 years Risk-free interest rate 1.0 % N/A 1.0 % 1.0 % Expected dividend yield 0.0 % N/A 0.0 % 0.0 % |
Weighted Average Fair Value Per Share Of Equity-Based Awards | The weighted-average grant date fair value of equity-based awards (per award) and pre-tax equity-based compensation expense (in thousands) was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options $ 7.21 N/A $ 10.15 $ 9.05 ESPP shares $ 7.02 $ 5.12 $ 7.30 $ 5.33 Restricted awards $ 16.70 $ 13.13 $ 22.98 $ 22.27 Pre-tax equity-based compensation, excluding amounts included in restructuring expense $ 13,676 $ 8,328 $ 32,031 $ 31,044 Pre-tax equity-based compensation, included in restructuring expense $ 14,731 $ — $ 14,731 $ — |
Schedule of Stock Option Activity | Activity under the Company's stock option plans for the nine months ended September 30, 2016 was as follows: Options (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (In Thousands) Outstanding at December 31, 2015 3,721 $ 30.37 Assumed in connection with TiVo Acquisition 875 $ 16.24 Granted 223 $ 23.13 Exercised (195 ) $ 16.77 Forfeited and canceled (441 ) $ 31.11 Outstanding at September 30, 2016 4,183 $ 27.58 2.8 years $ 3,873 Vested and expected to vest at September 30, 2016 4,040 $ 27.72 2.7 years $ 3,862 Exercisable at September 30, 2016 3,318 $ 28.65 2.1 years $ 3,790 |
Restricted Awards Activity | Activity related to the Company's restricted awards for the nine months ended September 30, 2016 was as follows: Restricted Awards (In Thousands) Weighted-Average Grant Date Fair Value Outstanding at December 31, 2015 3,681 $ 21.63 Assumed in connection with TiVo Acquisition 2,409 $ 22.42 Granted 1,338 $ 21.79 Vested (1,578 ) $ 22.24 Forfeited (303 ) $ 21.80 Outstanding at September 30, 2016 5,547 $ 21.83 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense | Income tax (benefit) expense were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Release of deferred tax asset valuation allowance $ (88,138 ) $ — $ (88,138 ) $ — Foreign withholding tax 3,316 4,080 9,759 10,737 State income tax (benefit) expense 140 (229 ) 263 (2,411 ) Foreign income tax 934 649 1,771 1,775 Change in net deferred tax liabilities 303 (65 ) 1,224 3,568 Change in unrecognized tax benefits — (727 ) 296 (745 ) Income tax (benefit) expense $ (83,445 ) $ 3,708 $ (74,825 ) $ 12,924 |
Summary of Operating Loss Carryforwards | As of December 31, 2015 , the Company had recorded deferred tax assets for the tax effects of the following gross tax loss carryforwards (in thousands): Carryforward Amount Years of Expiration Federal (1) $ 1,155,486 2020 - 2033 State (2) $ 821,952 2017 - 2033 (1) Includes $180.0 million related to stock option deductions that are not included in deferred tax assets. (2) Includes $27.4 million related to stock option deductions that are not included in deferred tax assets. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Segment results were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Intellectual Property Licensing Service Provider $ 66,684 $ 45,890 $ 162,791 $ 144,344 Consumer Electronics 15,139 11,630 43,011 47,927 Revenues 81,823 57,520 205,802 192,271 Adjusted Operating Expenses (1) 19,349 15,515 51,203 47,535 Adjusted EBITDA (2) 62,474 42,005 154,599 144,736 Product Service Provider 59,389 48,117 162,480 149,440 Consumer Electronics 9,153 5,825 18,010 16,586 Other 2,756 3,420 10,458 18,430 Revenues 71,298 57,362 190,948 184,456 Adjusted Operating Expenses (1) 59,807 45,811 150,957 146,959 Adjusted EBITDA (2) 11,491 11,551 39,991 37,497 Corporate: Adjusted Operating Expenses (1) 14,151 11,907 38,406 38,472 Adjusted EBITDA (2) (14,151 ) (11,907 ) (38,406 ) (38,472 ) Consolidated: Revenues 153,121 114,882 396,750 376,727 Adjusted Operating Expenses (1) 93,307 73,233 240,566 232,966 Adjusted EBITDA (2) 59,814 41,649 156,184 143,761 Depreciation 4,622 4,280 13,181 13,098 Amortization of intangible assets 24,925 19,189 63,087 57,789 Restructuring and asset impairment charges 22,311 218 24,644 1,757 Equity-based compensation 13,676 8,328 32,031 31,044 Transaction, transition and integration costs 13,996 — 20,039 — Earnout amortization and settlement 319 (860 ) 1,508 (860 ) Contested proxy election costs — — — 4,346 Change in franchise tax reserve — — 154 — Operating (loss) income from continuing operations (20,035 ) 10,494 1,540 36,587 Interest expense (11,021 ) (11,348 ) (32,411 ) (35,421 ) Interest income and other, net 353 586 322 1,089 Income (loss) on interest rate swaps 1,697 (11,787 ) (16,897 ) (17,106 ) Loss on debt extinguishment — (2,695 ) — (2,815 ) Loss from continuing operations before income taxes $ (29,006 ) $ (14,750 ) $ (47,446 ) $ (17,666 ) (1) Adjusted Operating Expenses is defined as operating expenses excluding depreciation, amortization of intangible assets, restructuring and asset impairment charges, equity-based compensation, transaction, transition and integration expenses, retention earn-outs payable to former shareholders of acquired businesses, changes in contingent consideration, earn-out settlements, contested proxy election costs and changes in franchise tax reserves. (2) Adjusted EBITDA is defined as operating income excluding depreciation, amortization of intangible assets, restructuring and asset impairment charges, equity-based compensation, transaction, transition and integration expenses, retention earn-outs payable to former shareholders of acquired businesses, changes in contingent consideration, earn-out settlements, contested proxy election costs and changes in franchise tax reserves. |
Basis of Presentation and Sig35
Basis of Presentation and Significant Accounting Policies - Concentration of Customers (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016USD ($)arrangement | Sep. 30, 2015 | Sep. 30, 2016USD ($)arrangement | Sep. 30, 2015 | Dec. 31, 2015 | |
Basis of Presentation and Summary of Significant Accounting Policies | |||||
Due from banks | $ 0.8 | $ 0.8 | |||
Proceeds from sale of patents | $ 0.3 | $ 0.8 | |||
Lifetime subscription amortization period | 66 months | ||||
Subscription cancellation period for full refund | 30 days | ||||
Product return period | 30 days | ||||
MSO [Member] | |||||
Basis of Presentation and Summary of Significant Accounting Policies | |||||
Number of arrangements | arrangement | 2 | 2 | |||
Customer Concentration Risk [Member] | AT&T Inc. [Member] | Sales Revenue, Net [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk (percent) | 13.00% | 14.00% | 13.00% | 13.00% | |
Customer Concentration Risk [Member] | AT&T Inc. [Member] | Accounts Receivable [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk (percent) | 15.00% | 22.00% | |||
Customer Concentration Risk [Member] | Charter Communications Inc. [Member] | Sales Revenue, Net [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk (percent) | 11.00% | 11.00% | 10.00% | ||
Customer Concentration Risk [Member] | Virgin Media Inc. [Member] | Accounts Receivable [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk (percent) | 14.00% | ||||
Customer Concentration Risk [Member] | DISH [Member] | Accounts Receivable [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk (percent) | 12.00% |
TiVo Acquisition - Narrative (D
TiVo Acquisition - Narrative (Details) $ / shares in Units, $ in Thousands, shares in Millions | Sep. 07, 2016USD ($)$ / sharesshares | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2016USD ($)$ / shares |
Business Acquisition [Line Items] | |||
Share price (in us dollars per share) | $ / shares | $ 19.48 | $ 19.48 | |
2% Convertible Senior Notes Due Oct 2021 [Member] | Convertible Debt [Member] | |||
Business Acquisition [Line Items] | |||
Interest rate of debt, stated percentage | 2.00% | 2.00% | |
TiVo Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Cash paid per share (in dollars per share) | $ / shares | $ 2.75 | ||
Share price exchange ratio | 0.3853 | ||
Share price (in us dollars per share) | $ / shares | $ 22.42 | ||
Accrual for merger consideration | $ 85,711 | ||
Escrow amount related to cash portion of the merger | $ 27,300 | ||
Revenue of acquiree since acquisition date | $ 21,600 | $ 21,600 | |
Operating loss of acquiree | $ (31,000) | $ (31,000) | |
TiVo Inc. [Member] | Employee Stock Options, Restricted Stock Award or Restricted Stock Unit [Member] | |||
Business Acquisition [Line Items] | |||
Share price exchange ratio | 0.5186 | ||
TiVo Inc. [Member] | Stock Options and Stock-Based Awards [Member] | |||
Business Acquisition [Line Items] | |||
Expected volatility rate (percent) | 31.70% | ||
Expected term | 9 months | ||
Risk-free interest rate (percent) | 0.50% | ||
Dividend rate (percent) | 0.00% | ||
TiVo Corporation [Member] | Stock Options and Stock-Based Awards [Member] | |||
Business Acquisition [Line Items] | |||
Expected volatility rate (percent) | 46.50% | ||
Expected term | 9 months | ||
Risk-free interest rate (percent) | 0.50% | ||
Dividend rate (percent) | 0.00% | ||
Common Stock [Member] | TiVo Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Stock issued for acquisitions during period (in shares) | shares | 33.5 | ||
Rovi [Member] | TiVo Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Conversion of stock ratio | 1 | ||
Tivo Solutions [Member] | TiVo Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Dissenting shares outstanding (in shares) | shares | 9.9 | ||
Tivo Solutions [Member] | TiVo Inc. [Member] | Performance-Based Awards [Member] | |||
Business Acquisition [Line Items] | |||
Expected volatility rate (percent) | 37.50% | ||
Expected term | 2 years 4 months 24 days | ||
Risk-free interest rate (percent) | 0.80% | ||
Dividend rate (percent) | 0.00% | ||
TiVo Corporation [Member] | TiVo Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Dissenting shares outstanding (in shares) | shares | 3.8 |
TiVo Acquisition - Purchase Pri
TiVo Acquisition - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Sep. 07, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Goodwill | $ 1,808,623 | $ 1,343,652 | |
TiVo Inc. [Member] | |||
Business Combination, Consideration Transferred [Abstract] | |||
Aggregate cash consideration | $ 269,990 | ||
Aggregate fair value of TiVo Corporation shares issued | 751,385 | ||
Fair value of assumed TiVo Solutions employee stock-based awards allocated to consideration | 22,640 | ||
Accrual for merger consideration | 85,711 | ||
Total merger consideration | 1,129,726 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Cash, cash equivalents and marketable securities | 503,408 | ||
Accounts receivable | 48,766 | ||
Inventory | 15,003 | ||
Prepaid expenses and other current assets and other long-term assets | 25,976 | ||
Property and equipment | 10,370 | ||
Goodwill | 464,111 | ||
Accounts payable and accrued expenses and other long-term liabilities | (74,736) | ||
Deferred revenue | (63,428) | ||
Current portion of long-term debt | (230,000) | ||
Deferred tax liabilities, net | (92,744) | ||
Total merger consideration | 1,129,726 | ||
TiVo Inc. [Member] | Trademarks / Tradenames [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Trademarks / Tradenames | 14,000 | ||
TiVo Inc. [Member] | Developed Technology and Patents [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Finite-lived intangible assets | 154,000 | ||
TiVo Inc. [Member] | Existing Contracts and Customer Relationships [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Finite-lived intangible assets | $ 355,000 |
TiVo Acquisition - Pro Forma In
TiVo Acquisition - Pro Forma Information (Details) - TiVo Inc. [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Business Acquisition [Line Items] | ||||
Revenues, net: | $ 208,690 | $ 215,281 | $ 616,137 | $ 655,029 |
Income (loss) from continuing operations, net of tax | $ (35,380) | $ (45,395) | $ (120,633) | $ (123,081) |
Basic income (loss) per share from continuing operations (in usd per share) | $ (0.28) | $ (0.39) | $ (1.02) | $ (1.03) |
Diluted income (loss) per share from continuing operations (in usd per share) | $ (0.28) | $ (0.39) | $ (1.02) | $ (1.03) |
Financial Statement Details (De
Financial Statement Details (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Accounts Receivable, Net | |||
Accounts receivable, gross | $ 147,388 | $ 88,735 | |
Less: Allowance for doubtful accounts | (1,658) | (1,607) | |
Accounts receivable, net | 145,730 | 87,128 | |
Inventory, Net | |||
Raw materials | 2,165 | 0 | |
Finished goods | 12,034 | 456 | |
Inventory, Net | 14,199 | 456 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 162,731 | 162,885 | |
Less: Accumulated depreciation and amortization | (119,217) | (127,901) | |
Property and equipment, net | 43,514 | 34,984 | |
Accounts Payable and Accrued Expenses | |||
Accounts payable | 32,739 | 9,013 | |
Accrued compensation and benefits | 43,387 | 27,056 | |
Accrual for merger consideration | 85,711 | 0 | |
Other accrued liabilities | 72,877 | 38,044 | |
Accounts payable and accrued expenses | 234,714 | 74,113 | |
Significant noncash transactions | |||
Fair value of shares issued in connection with TiVo Acquisition | 751,385 | $ 0 | |
Computer Software and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 130,075 | 133,631 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 25,143 | 21,578 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 7,513 | $ 7,676 |
Investments - Available-For-Sal
Investments - Available-For-Sale Investment Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Total Cash, Cash Equivalents And Marketable Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | $ 619,771 | $ 324,269 |
Auction Rate Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 10,800 | 10,800 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | (432) | (540) |
Fair Value | 10,368 | 10,260 |
Corporate Debt Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 104,367 | 98,997 |
Unrealized Gains | 57 | 0 |
Unrealized Losses | (88) | (327) |
Fair Value | 104,336 | 98,670 |
Foreign Government Obligations [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 6,648 | 11,878 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | (3) | (56) |
Fair Value | 6,645 | 11,822 |
U.S. Treasuries / Agencies [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 115,865 | 102,120 |
Unrealized Gains | 46 | 5 |
Unrealized Losses | (105) | (283) |
Fair Value | 115,806 | 101,842 |
Marketable Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 237,680 | 223,795 |
Unrealized Gains | 103 | 5 |
Unrealized Losses | (628) | (1,206) |
Fair Value | 237,155 | 222,594 |
Total Cash And Cash Equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 382,616 | 101,675 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 382,616 | 101,675 |
Cash [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 162,282 | 56,745 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 162,282 | 56,745 |
Cash Equivalents - Money Market Funds [Member] | Money Markets Funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 220,334 | 44,930 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | $ 220,334 | $ 44,930 |
Investments - Available-For-S41
Investments - Available-For-Sale Debt Investments At Fair Value (Details) $ in Thousands | Sep. 30, 2016USD ($) |
Amortized Cost | |
Due in less than 1 year | $ 121,227 |
Due in 1-2 years | 105,653 |
Due in more than 2 years | 10,800 |
Total | 237,680 |
Fair Value | |
Due in less than 1 year | 121,221 |
Due in 1-2 years | 105,566 |
Due in greater than 2 years | 10,368 |
Total | $ 237,155 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets And Liabilities Measured And Recorded At Fair Value On A Recurring Basis (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | $ 457,489 | $ 267,524 |
Fair value liabilities measured on a recurring basis | (43,078) | (25,752) |
Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 220,334 | 44,930 |
Fair value liabilities measured on a recurring basis | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 226,787 | 212,334 |
Fair value liabilities measured on a recurring basis | (35,469) | (25,752) |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 10,368 | 10,260 |
Fair value liabilities measured on a recurring basis | (7,609) | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 44,930 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Money Market Funds [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 44,930 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Money Market Funds [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Money Market Funds [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Corporate Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 72,084 | 43,876 |
Cash and cash equivalents/Short-term marketable securities [Member] | Corporate Debt Securities [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | Corporate Debt Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 72,084 | 43,876 |
Cash and cash equivalents/Short-term marketable securities [Member] | Corporate Debt Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | Foreign Government Obligations [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 6,645 | 7,827 |
Cash and cash equivalents/Short-term marketable securities [Member] | Foreign Government Obligations [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | Foreign Government Obligations [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 6,645 | 7,827 |
Cash and cash equivalents/Short-term marketable securities [Member] | Foreign Government Obligations [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 42,492 | 56,176 |
Cash and cash equivalents/Short-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 42,492 | 56,176 |
Cash and cash equivalents/Short-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Cash and cash equivalents/Short-term marketable securities [Member] | Cash and Cash Equivalents [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 220,334 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Cash and Cash Equivalents [Member] | Money Market Funds [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 220,334 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Cash and Cash Equivalents [Member] | Money Market Funds [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Cash and cash equivalents/Short-term marketable securities [Member] | Cash and Cash Equivalents [Member] | Money Market Funds [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Long-term marketable securities [Member] | Corporate Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 32,252 | 54,794 |
Long-term marketable securities [Member] | Corporate Debt Securities [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | Corporate Debt Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 32,252 | 54,794 |
Long-term marketable securities [Member] | Corporate Debt Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | Foreign Government Obligations [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 3,995 | |
Long-term marketable securities [Member] | Foreign Government Obligations [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Long-term marketable securities [Member] | Foreign Government Obligations [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 3,995 | |
Long-term marketable securities [Member] | Foreign Government Obligations [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | |
Long-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 73,314 | 45,666 |
Long-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 73,314 | 45,666 |
Long-term marketable securities [Member] | U.S. Treasuries / Agencies [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | Auction Rate Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 10,368 | 10,260 |
Long-term marketable securities [Member] | Auction Rate Securities [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | Auction Rate Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 0 | 0 |
Long-term marketable securities [Member] | Auction Rate Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assets measured on recurring basis | 10,368 | 10,260 |
Accounts payable and accrued expenses [Member] | Cubiware Contingent Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (4,091) | |
Accounts payable and accrued expenses [Member] | Cubiware Contingent Consideration [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | |
Accounts payable and accrued expenses [Member] | Cubiware Contingent Consideration [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | |
Accounts payable and accrued expenses [Member] | Cubiware Contingent Consideration [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (4,091) | |
Accounts payable and accrued expenses [Member] | Interest Rate Swaps [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (1,483) | (195) |
Accounts payable and accrued expenses [Member] | Interest Rate Swaps [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | 0 |
Accounts payable and accrued expenses [Member] | Interest Rate Swaps [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (1,483) | (195) |
Accounts payable and accrued expenses [Member] | Interest Rate Swaps [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | 0 |
Other long-term liabilities [Member] | Cubiware Contingent Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (3,518) | |
Other long-term liabilities [Member] | Cubiware Contingent Consideration [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | |
Other long-term liabilities [Member] | Cubiware Contingent Consideration [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | |
Other long-term liabilities [Member] | Cubiware Contingent Consideration [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (3,518) | |
Other long-term liabilities [Member] | Interest Rate Swaps [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (33,986) | (25,557) |
Other long-term liabilities [Member] | Interest Rate Swaps [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | 0 | 0 |
Other long-term liabilities [Member] | Interest Rate Swaps [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | (33,986) | (25,557) |
Other long-term liabilities [Member] | Interest Rate Swaps [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities measured on a recurring basis | $ 0 | $ 0 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Level 3 Measurements (Details) - Significant Unobservable Inputs (Level 3) [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Cubiware Contingent Consideration [Member] | ||||
Assets | ||||
Assumed in TiVo Acquisition | $ (7,542) | $ (7,542) | ||
Gain (loss) included in earnings | (67) | (67) | ||
Liabilities | ||||
Balance at beginning of period | 0 | 0 | ||
Settlements | 0 | |||
Assumed in TiVo Acquisition | (7,542) | (7,542) | ||
Gain (loss) included in earnings | (67) | (67) | ||
Balance at end of period | (7,609) | (7,609) | ||
IntegralReach Contingent Consideration [Member] | ||||
Liabilities | ||||
Balance at beginning of period | $ (3,000) | |||
Settlements | 3,000 | |||
Balance at end of period | $ 0 | 0 | ||
Veveo Contingent Consideration [Member] | ||||
Assets | ||||
Gain (loss) included in earnings | 860 | 860 | ||
Liabilities | ||||
Balance at beginning of period | (860) | (3,000) | ||
Settlements | 2,140 | |||
Gain (loss) included in earnings | 860 | 860 | ||
Balance at end of period | 0 | 0 | ||
Auction Rate Securities [Member] | ||||
Assets | ||||
Balance at beginning of period | 10,260 | 10,584 | 10,260 | 10,638 |
Unrealized gains (losses) included in other comprehensive (loss) income | 108 | (108) | 108 | (162) |
Balance at end of period | 10,368 | 10,476 | 10,368 | 10,476 |
Liabilities | ||||
Unrealized gains (losses) included in other comprehensive (loss) income | $ 108 | $ (108) | $ 108 | $ (162) |
Fair Value Measurements - Outst
Fair Value Measurements - Outstanding Debt Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying Amount | $ 1,202,733 | $ 967,156 |
Convertible Debt [Member] | 2021 Convertible Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying Amount | 230,000 | 0 |
Convertible Debt [Member] | 2020 Convertible Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying Amount | 294,229 | 284,241 |
Line of Credit [Member] | Term Loan B Facility [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying Amount | 678,504 | 682,915 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,274,147 | 955,182 |
Significant Other Observable Inputs (Level 2) [Member] | Convertible Debt [Member] | 2021 Convertible Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 230,000 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | Convertible Debt [Member] | 2020 Convertible Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 359,042 | 298,494 |
Significant Other Observable Inputs (Level 2) [Member] | Line of Credit [Member] | Term Loan B Facility [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 685,105 | $ 656,688 |
Goodwill And Intangible Asset45
Goodwill And Intangible Assets, Net - Narrative (Details) - USD ($) $ in Thousands | Sep. 07, 2016 | Jan. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2015 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Payments for purchase of patents | $ 2,500 | $ 2,500 | $ 0 | |
Developed Technology and Patents [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible assets weighted average useful life | 8 years | |||
Existing Contracts and Customer Relationships [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible assets weighted average useful life | 11 years | |||
Patents [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible assets weighted average useful life | 5 years 3 months 18 days | |||
Tivo Solutions [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible assets | $ 523,000 |
Goodwill And Intangible Asset46
Goodwill And Intangible Assets, Net - Summary Of Goodwill Activity (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, Beginning balance | $ 1,343,652 |
TiVo Acquisition | 464,111 |
Foreign currency translation | 860 |
Goodwill, Ending balance | 1,808,623 |
Intellectual Property Licensing [Member] | |
Goodwill [Roll Forward] | |
Goodwill, Beginning balance | 1,184,500 |
TiVo Acquisition | 106,566 |
Foreign currency translation | 0 |
Goodwill, Ending balance | 1,291,066 |
Product [Member] | |
Goodwill [Roll Forward] | |
Goodwill, Beginning balance | 159,152 |
TiVo Acquisition | 357,545 |
Foreign currency translation | 860 |
Goodwill, Ending balance | $ 517,557 |
Goodwill And Intangible Asset47
Goodwill And Intangible Assets, Net - Summary Of Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 1,502,199 | $ 990,026 |
Accumulated Amortization | (666,668) | (603,284) |
Total | 835,531 | 386,742 |
Intangible Assets, Gross (Excluding Goodwill) | 1,516,199 | |
Intangible Assets, Net (Excluding Goodwill) | 849,531 | 386,742 |
Developed Technology and Patents [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | 1,031,687 | 875,188 |
Accumulated Amortization | (564,495) | (512,060) |
Total | $ 467,192 | 363,128 |
Weighted-Average Remaining Useful Life | 5 years 10 months | |
Existing Contracts and Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 402,524 | 47,524 |
Accumulated Amortization | (45,154) | (36,933) |
Total | $ 357,370 | 10,591 |
Weighted-Average Remaining Useful Life | 11 years | |
Content Databases and Other [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 59,688 | 59,014 |
Accumulated Amortization | (48,719) | (45,991) |
Total | $ 10,969 | 13,023 |
Weighted-Average Remaining Useful Life | 6 years 4 months | |
Trademarks / Tradenames [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 8,300 | 8,300 |
Accumulated Amortization | (8,300) | (8,300) |
Total | 0 | $ 0 |
TiVo Inc. [Member] | TiVo Tradename [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-Lived Trade Names | $ 14,000 |
Goodwill And Intangible Asset48
Goodwill And Intangible Assets, Net - Estimated Amortization Expense In Future Periods (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2016 | $ 41,932 | |
2,017 | 166,214 | |
2,018 | 146,794 | |
2,019 | 109,345 | |
2,020 | 108,579 | |
Thereafter | 262,667 | |
Total | $ 835,531 | $ 386,742 |
Restructuring and Asset Impai49
Restructuring and Asset Impairment Charges - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and asset impairment charges | $ 22,311 | $ 218 | $ 24,644 | $ 1,757 |
Legacy Rovi Plans [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and asset impairment charges | 0 | $ 2,300 | ||
Accrual adjustment | $ 1,000 | $ 1,000 |
Restructuring and Asset Impai50
Restructuring and Asset Impairment Charges - Components of Restructuring and Asset Impairment Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | ||||
Future minimum lease payments, net | $ 0 | $ 435 | $ 214 | $ 1,934 |
Severance costs | 7,580 | (217) | 7,968 | (177) |
Share-based payments | 14,731 | 0 | 14,731 | 0 |
Contract termination costs | 0 | 0 | 1,279 | 0 |
Asset impairment | 0 | 0 | 452 | 0 |
Restructuring and asset impairment charges | $ 22,311 | $ 218 | $ 24,644 | $ 1,757 |
Restructuring and Asset Impai51
Restructuring and Asset Impairment Charges - Accrued Restructuring Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||||
Future minimum lease payments, net | $ 0 | $ 435 | $ 214 | $ 1,934 | |
Severance costs | 7,580 | (217) | 7,968 | (177) | |
Contract termination costs | $ 0 | $ 0 | 1,279 | $ 0 | |
Accrued Restructuring Costs [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Future minimum lease payments, net | 655 | $ 2,015 | |||
Severance costs | 6,975 | 250 | |||
Contract termination costs | 120 | 0 | |||
Accrued restructuring costs | $ 7,750 | $ 2,265 |
Restructuring and Asset Impai52
Restructuring and Asset Impairment Charges - Restructuring Activities (Details) - 2016 Tivo Corporation Plan [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2016 | Sep. 30, 2016 | |
Restructuring Reserve [Roll Forward] | ||
Balance at Beginning of Period | $ 0 | $ 0 |
Restructuring Expense | 22,311 | 22,311 |
Cash Settlements | (1,599) | (1,599) |
Non-Cash Settlements | (14,731) | (14,731) |
Balance at End of Period | 5,981 | 5,981 |
Severance [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Balance at Beginning of Period | 0 | 0 |
Restructuring Expense | 7,580 | 7,580 |
Cash Settlements | (1,599) | (1,599) |
Non-Cash Settlements | 0 | 0 |
Balance at End of Period | 5,981 | 5,981 |
Share-based Payments [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Balance at Beginning of Period | 0 | 0 |
Restructuring Expense | 14,731 | 14,731 |
Cash Settlements | 0 | 0 |
Non-Cash Settlements | (14,731) | (14,731) |
Balance at End of Period | $ 0 | $ 0 |
Debt and Interest Rate Swaps -
Debt and Interest Rate Swaps - Schedule of Outstanding Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 | Mar. 04, 2015 | Sep. 22, 2014 |
Debt Instrument [Line Items] | ||||
Outstanding Principal | $ 1,259,250 | $ 1,034,500 | ||
Carrying amount | 1,202,733 | 967,156 | ||
Less: Current portion of long-term debt | 237,000 | 7,000 | ||
Long-term debt, less current portion | $ 965,733 | 960,156 | ||
Convertible Debt [Member] | 2021 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate of debt, stated percentage | 2.00% | 2.00% | ||
Outstanding Principal | $ 230,000 | 0 | ||
Carrying amount | $ 230,000 | 0 | ||
Convertible Debt [Member] | 2020 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate of debt, stated percentage | 0.50% | 0.50% | ||
Outstanding Principal | $ 345,000 | 345,000 | ||
Carrying amount | 294,229 | 284,241 | ||
Line of Credit [Member] | Term Loan B Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding Principal | 684,250 | 689,500 | ||
Carrying amount | $ 678,504 | $ 682,915 |
Debt and Interest Rate Swaps 54
Debt and Interest Rate Swaps - 2021 Convertible Notes (Details) - 2021 Convertible Notes [Member] $ / shares in Units, shares in Millions | Oct. 12, 2016USD ($) | Sep. 08, 2016$ / shares | Sep. 22, 2014USD ($)$ / shares | Oct. 31, 2016USD ($) | Sep. 30, 2016USD ($)shares |
Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt issued | $ 230,000,000 | ||||
Interest rate of debt, stated percentage | 2.00% | 2.00% | |||
Convertible notes, percentage of principal to be paid on notes redeemed | 100.00% | ||||
Tivo Solutions [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Shares issued per $1,000 principal amount | 0.561073 | ||||
Initial conversion price (in usd per share) | $ / shares | $ 17.8230 | ||||
TiVo Corporation [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Shares issued per $1,000 principal amount | 0.216181 | ||||
Initial conversion price (in usd per share) | $ / shares | $ 39.12 | ||||
Initial conversion price to principal of notes (in usd per share) | $ / shares | $ 154.30 | ||||
Subsequent Event [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of convertible debt | $ 229,950,000 | ||||
Equity Option [Member] | |||||
Debt Instrument [Line Items] | |||||
Call option, shares | shares | 12.9 | ||||
Equity Option [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Proceeds from derivative instrument | $ 5,700,000 | ||||
Payments for repurchase of warrants | $ 2,900,000 | ||||
Equity Option [Member] | Subsequent Event [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Payments for repurchase of warrants | $ 2,900,000 | ||||
Warrants to Purchase Common Stock [Member] | Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Warrants outstanding, shares | shares | 12.9 |
Debt and Interest Rate Swaps 55
Debt and Interest Rate Swaps - 2020 Convertible Notes (Details) - Convertible Debt [Member] - 2020 Convertible Notes [Member] | Mar. 04, 2015USD ($)trading_day$ / shares | Sep. 30, 2016 |
Debt Instrument [Line Items] | ||
Debt issued | $ 345,000,000 | |
Interest rate of debt, stated percentage | 0.50% | 0.50% |
Shares issued per $1,000 principal amount | 0.345968 | |
Initial conversion price (in usd per share) | $ / shares | $ 28.9044 | |
Threshold trading days | trading_day | 20 | |
Consecutive trading days | 30 days | |
Minimum percentage of common stock price on applicable conversion price resulting in the noteholders ability to convert the notes into cash or stock | 130.00% | |
Threshold business days | 5 days | |
Measurement period | 10 days | |
Maximum percentage of product under last reported sale price for conversion eligibility | 98.00% | |
Convertible notes, percentage of principal to be paid on notes redeemed | 100.00% | |
Non-convertible borrowing rate (percent) | 4.75% | |
Transaction costs | $ 9,300,000 | |
Long-term Debt [Member] | ||
Debt Instrument [Line Items] | ||
Transaction costs | 7,600,000 | |
Additional Paid-in Capital [Member] | ||
Debt Instrument [Line Items] | ||
Transaction costs | $ 1,700,000 |
Debt and Interest Rate Swaps 56
Debt and Interest Rate Swaps - Equity Component of Convertible Notes (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Principal outstanding | $ 1,259,250 | $ 1,034,500 |
Carrying amount | 1,202,733 | 967,156 |
2020 Convertible Notes [Member] | Convertible Debt [Member] | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 345,000 | 345,000 |
Less: Unamortized debt discount | (45,215) | (54,215) |
Less: Unamortized debt issue costs | (5,556) | (6,544) |
Carrying amount | 294,229 | 284,241 |
Equity Component | $ 63,854 | $ 63,854 |
Debt and Interest Rate Swaps 57
Debt and Interest Rate Swaps - Purchased Call Options and Sold Warrants (Details) - 2020 Convertible Notes [Member] - Convertible Debt [Member] $ / shares in Units, shares in Millions, $ in Millions | Mar. 04, 2015USD ($)$ / shares$ / per_unitshares |
Warrants to Purchase Common Stock [Member] | |
Debt Instrument [Line Items] | |
(Payments) proceeds from (purchase) sale of warrants | $ | $ 31.3 |
Warrants outstanding, shares | shares | 11.9 |
Warrant exercise price (in usd per share) | $ / shares | $ 40.1450 |
Equity Option [Member] | |
Debt Instrument [Line Items] | |
Purchase of call options | $ | $ 64.8 |
Call option, shares | shares | 11.9 |
Common stock strike price (in usd per share) | $ / per_unit | 28.9044 |
Debt and Interest Rate Swaps 58
Debt and Interest Rate Swaps - Senior Secured Term Loans (Details) | Jul. 02, 2014USD ($)subsidiary | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Feb. 28, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) |
Debt Instrument [Line Items] | ||||||
Number of wholly-owned subsidiaries | subsidiary | 2 | |||||
Proceeds from revolving credit facility | $ 0 | $ 100,000,000 | ||||
Term Loan A Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument term | 5 years | |||||
Debt issued | $ 125,000,000 | |||||
Term Loan B Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument term | 7 years | |||||
Debt issued | $ 700,000,000 | |||||
Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument term | 5 years | |||||
Maximum borrowing capacity | $ 175,000,000 | |||||
LIBOR [Member] | Term Loan A Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 2.25% | |||||
LIBOR [Member] | Term Loan B Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 3.00% | |||||
LIBOR floor | 0.75% | |||||
LIBOR [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 2.25% | |||||
Prime Rate [Member] | Term Loan A Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 1.25% | |||||
Prime Rate [Member] | Term Loan B Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 2.00% | |||||
Prime Rate [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable interest rate | 1.25% | |||||
Minimum [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate reduction based on secured leverage ratio | 0.25% | |||||
Maximum [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate reduction based on secured leverage ratio | 0.50% | |||||
Line of Credit [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from revolving credit facility | $ 100,000,000 | |||||
Line of Credit [Member] | Term Loan A Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of long-term debt | $ 75,000,000 | $ 50,000,000 |
Debt and Interest Rate Swaps 59
Debt and Interest Rate Swaps - Convertible Senior Notes Due 2040 (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2015 | Feb. 20, 2015 | Mar. 17, 2010 | |
Debt Instrument [Line Items] | |||||||
Loss on debt extinguishment | $ 0 | $ 2,695,000 | $ 0 | $ 2,815,000 | |||
2040 Convertible Notes [Member] | Convertible Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt issued | $ 460,000,000 | ||||||
Interest rate of debt, stated percentage | 2.625% | ||||||
Outstanding principal exercised | $ 3,600,000 | $ 287,400,000 | |||||
Loss on debt extinguishment | $ 100,000 |
Debt and Interest Rate Swaps 60
Debt and Interest Rate Swaps - Components of Interest Expense (Details) - Convertible Debt [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
2020 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Stated interest | $ 431 | $ 431 | $ 1,294 | $ 1,006 |
Amortization of debt discount | 3,035 | 2,897 | 9,000 | 6,708 |
Amortization of debt issuance costs | 338 | 351 | 988 | 814 |
Total interest expense | 3,804 | 3,679 | 11,282 | 8,528 |
2040 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Stated interest | 0 | 0 | 0 | 1,114 |
Amortization of debt discount | 0 | 0 | 0 | 1,865 |
Amortization of debt issuance costs | 0 | 0 | 0 | 242 |
Total interest expense | $ 0 | $ 0 | $ 0 | $ 3,221 |
Debt and Interest Rate Swaps 61
Debt and Interest Rate Swaps - Schedule of Maturities (Details) - USD ($) $ in Thousands | Oct. 12, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | |||
Remainder of 2016 | $ 231,750 | ||
2,017 | 7,000 | ||
2,018 | 7,000 | ||
2,019 | 352,000 | ||
2,020 | 7,000 | ||
Thereafter | 654,500 | ||
Total | 1,259,250 | $ 1,034,500 | |
Convertible Debt [Member] | 2021 Convertible Notes [Member] | |||
Debt Disclosure [Abstract] | |||
Total | $ 230,000 | $ 0 | |
Subsequent Event [Member] | Convertible Debt [Member] | 2021 Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Repayments of convertible debt | $ 229,950 |
Debt and Interest Rate Swaps 62
Debt and Interest Rate Swaps - Interest Rate Swaps (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Mar. 31, 2017 | Jan. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2014 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Gain (loss) on interest rate swaps | $ 1,697 | $ (11,787) | $ (16,897) | $ (17,106) | ||||
Not Designated as Hedging Instrument [Member] | $197M May 2012 [Member] | Long [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 1.65% | 0.58% | ||||||
Not Designated as Hedging Instrument [Member] | $215M May 2012 [Member] | Long [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 0.65% | |||||||
Not Designated as Hedging Instrument [Member] | $215M May 2012 [Member] | Long [Member] | Forecast [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 2.11% | |||||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $197M May 2012 [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional amount of interest rate swaps | 0 | 0 | $ 197,000 | |||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $215M May 2012 [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional amount of interest rate swaps | 215,000 | 215,000 | 215,000 | |||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $250M June 2013 Swaps [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional amount of interest rate swaps | $ 250,000 | $ 250,000 | 250,000 | |||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $250M June 2013 Swaps [Member] | Long [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 2.23% | 2.23% | ||||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $125M September 2014 Swaps [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional amount of interest rate swaps | $ 125,000 | $ 125,000 | 125,000 | |||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $125M September 2014 Swaps [Member] | Long [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 2.66% | 2.66% | ||||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $250M September 2014 Swaps [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Notional amount of interest rate swaps | $ 200,000 | $ 200,000 | $ 200,000 | |||||
Not Designated as Hedging Instrument [Member] | Line of Credit [Member] | $250M September 2014 Swaps [Member] | Long [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Fixed interest rate (percent) | 2.93% | 2.93% |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | Aug. 12, 2016petition | Jul. 20, 2016USD ($) | May 10, 2016USD ($) | Aug. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Feb. 11, 2016claim |
Loss Contingencies [Line Items] | |||||||
Product warranty period | 90 days | ||||||
Accrued warranty | $ 0.3 | ||||||
Extended warranty deferred revenue | 1.3 | ||||||
Deferred costs | 0.1 | ||||||
Settlement amount offered | 5 | $ 0.5 | |||||
Liability accrued | $ 5 | ||||||
Threatened Litigation [Member] | Unpaid Royalties [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Alleged unpaid royalties sought | $ 20.9 | $ 11.5 | |||||
Unpaid interest on alleged unpaid royalties | $ 11.8 | ||||||
Additional demand for alleged unpaid royalties | $ 9.5 | ||||||
Pending Litigation [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of claims | claim | 1 | ||||||
Pending Litigation [Member] | U.S. Patent No. 7,558,472 [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of petitions filed | petition | 2 | ||||||
Pending Litigation [Member] | U.S. Patent No. 8,457,476 [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Number of petitions filed | petition | 2 | ||||||
Minimum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product warranty period | 91 days | ||||||
Maximum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product warranty period | 365 days | ||||||
Lifetime Subscription [Member] | Minimum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product warranty period | 2 years | ||||||
Lifetime Subscription [Member] | Maximum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product warranty period | 3 years | ||||||
Inventories [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Total purchase commitments | $ 14.8 | ||||||
MSO [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product warranty period | 3 years | ||||||
DISH [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
License agreement term | 10 years | ||||||
Unrecorded Unconditional Purchase Obligation, Due in Next Twelve Months | $ 60.3 |
Commitments and Contingencies64
Commitments and Contingencies - Future Minimum Payments (Details) $ in Thousands | Sep. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Remainder of 2016 | $ 4,411 |
2,017 | 16,869 |
2,018 | 15,262 |
2,019 | 13,073 |
2,020 | 11,464 |
Thereafter | 57,462 |
Gross future minimum lease payments | 118,541 |
Less: Sublease revenues | (5,789) |
Net future minimum lease payments | $ 112,752 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, shares in Thousands | Sep. 07, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 08, 2016 | Apr. 29, 2015 | Mar. 04, 2015 |
Class of Stock [Line Items] | ||||||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 30,157 | 30,828 | 30,039 | 26,647 | ||||
Share price (in us dollars per share) | $ 19.48 | $ 19.48 | ||||||
Authorized stock repurchase amount | $ 125,000,000 | |||||||
Stock repurchased during period (shares) | 4,500 | 9,500 | ||||||
Stock repurchased during period | $ 50,000,000 | $ 150,200,000 | ||||||
Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Tax withholding for share-based compensation (shares) | 300 | 400 | ||||||
Tax withholding for share-based compensation | $ 5,300,000 | $ 9,400,000 | ||||||
Convertible Debt [Member] | 2020 Convertible Notes [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Initial conversion price (in usd per share) | $ 28.9044 | |||||||
Performance-based Restricted Stock and Restricted Stock Units [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 700 | 900 | 700 | 900 | ||||
Warrants to Purchase Common Stock [Member] | Convertible Debt [Member] | 2020 Convertible Notes [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Warrant exercise price (in usd per share) | $ 40.1450 | |||||||
TiVo Corporation [Member] | Convertible Debt [Member] | 2021 Convertible Notes [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Initial conversion price (in usd per share) | $ 39.12 | |||||||
TiVo Inc. [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Share price (in us dollars per share) | $ 22.42 | |||||||
TiVo Inc. [Member] | TiVo Corporation [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Dissenting shares outstanding (in shares) | 3,800 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Weighted Average Number of Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Equity [Abstract] | ||||
Weighted average shares used in computing basic per share amounts | 91,131 | 82,404 | 84,895 | 85,297 |
Dilutive effect of equity-based compensation awards (in shares) | 1,013 | 0 | 963 | 0 |
Weighted average shares used in computing diluted per share amounts | 92,144 | 82,404 | 85,858 | 85,297 |
Stockholders' Equity - Weighted
Stockholders' Equity - Weighted Average Potential Anti-Dilutive Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 30,157 | 30,828 | 30,039 | 26,647 |
Stock Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 3,332 | 4,124 | 3,497 | 4,236 |
Restricted Awards [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 1,483 | 2,832 | 2,176 | 2,887 |
Convertible Notes Payable [Member] | 2021 Convertible Notes [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 1,470 | 0 | 494 | 0 |
Convertible Notes Payable [Member] | 2020 Convertible Notes [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 11,936 | 11,936 | 11,936 | 9,181 |
Convertible Notes Payable [Member] | 2040 Convertible Notes [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 0 | 0 | 0 | 1,162 |
Warrants [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average potential shares excluded from the calculation of Diluted EPS | 11,936 | 11,936 | 11,936 | 9,181 |
Stockholders' Equity - Changes
Stockholders' Equity - Changes in Stockholders Equity (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance (common shares) | 131,052 | |||
Balance (treasury shares) | (48,405) | |||
Balance | $ 1,028,091 | $ 1,050,652 | $ 1,030,565 | $ 1,106,264 |
Net income (loss) | 49,922 | (18,458) | 22,862 | (30,590) |
Unrealized (losses) gains on marketable securities | (282) | (20) | 493 | (66) |
Other comprehensive income (loss), net of tax | 170 | 268 | $ 3,129 | (296) |
Issuance of common stock upon exercise of options, shares | 195 | |||
Issuance of common stock upon exercise of options | 496 | 184 | $ 3,270 | 1,478 |
Issuance of common stock under employee stock purchase plan | 6,140 | 2,716 | 10,696 | 7,289 |
Issuance of restricted stock, net | 0 | 0 | 0 | 0 |
Equity-based compensation | 28,421 | 8,328 | 46,760 | 31,044 |
Issuance of common stock in connection with TiVo Acquisition | 774,025 | 774,025 | ||
Cancellation of treasury stock | 0 | 0 | ||
Excess tax benefit associated with stock plans | $ 15 | 66 | ||
Equity component related to issuance of 2020 Convertible Notes | 63,854 | |||
Equity component related to 2020 Convertible Notes issuance costs | (1,737) | |||
Issuance of warrants related to 2020 Convertible Notes | 31,326 | |||
Purchase of call options related to 2020 Convertible Notes | $ (64,825) | |||
Stock repurchases, shares | (4,500) | (9,500) | ||
Stock repurchases | $ (5,323) | $ (50,000) | $ (9,365) | $ (150,168) |
Balance (common shares) | 119,891 | 119,891 | ||
Balance (treasury shares) | (232) | (232) | ||
Balance | $ 1,881,942 | $ 993,705 | $ 1,881,942 | $ 993,705 |
Common Stock [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance (common shares) | 131,888 | 130,756 | 131,052 | 130,627 |
Balance | $ 132 | $ 131 | $ 131 | $ 131 |
Issuance of common stock upon exercise of options, shares | 29 | 13 | 195 | 85 |
Issuance of common stock upon exercise of options | $ 0 | $ 0 | $ 0 | $ 0 |
Issuance of common stock under employee stock purchase plan, shares | 652 | 291 | 1,160 | 543 |
Issuance of common stock under employee stock purchase plan | $ 1 | $ 0 | $ 2 | $ 0 |
Cancellation of restricted stock, net, shares | 90 | (22) | 252 | (217) |
Issuance of restricted stock, net | $ 0 | $ 0 | $ 0 | $ 0 |
Issuance of common stock in connection with TiVo Acquisition, shares | 35,838 | 35,838 | ||
Issuance of common stock in connection with TiVo Acquisition | $ 36 | $ 36 | ||
Cancellation of treasury stock, shares | (48,606) | (48,606) | ||
Cancellation of treasury stock | $ (49) | $ (49) | ||
Balance (common shares) | 119,891 | 131,038 | 119,891 | 131,038 |
Balance | $ 120 | $ 131 | $ 120 | $ 131 |
Treasury Stock [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance (treasury shares) | (48,586) | (43,898) | (48,405) | (38,898) |
Balance | $ (1,167,575) | $ (1,113,386) | $ (1,163,533) | $ (1,013,218) |
Cancellation of treasury stock, shares | 48,606 | 48,606 | ||
Cancellation of treasury stock | $ 1,167,954 | $ 1,167,954 | ||
Stock repurchases, shares | (252) | (4,492) | (433) | (9,492) |
Stock repurchases | $ (5,323) | $ (50,000) | $ (9,365) | $ (150,168) |
Balance (treasury shares) | (232) | (48,390) | (232) | (48,390) |
Balance | $ (4,944) | $ (1,163,386) | $ (4,944) | $ (1,163,386) |
Additional Paid-in Capital [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | 2,445,589 | 2,397,069 | 2,419,921 | 2,339,817 |
Issuance of common stock upon exercise of options | 496 | 184 | 3,270 | 1,478 |
Issuance of common stock under employee stock purchase plan | 6,139 | 2,716 | 10,694 | 7,289 |
Issuance of restricted stock, net | 0 | 0 | 0 | 0 |
Equity-based compensation | 28,421 | 8,328 | 46,760 | 31,044 |
Issuance of common stock in connection with TiVo Acquisition | 773,989 | 773,989 | ||
Excess tax benefit associated with stock plans | 15 | 66 | ||
Equity component related to issuance of 2020 Convertible Notes | 63,854 | |||
Equity component related to 2020 Convertible Notes issuance costs | (1,737) | |||
Issuance of warrants related to 2020 Convertible Notes | 31,326 | |||
Purchase of call options related to 2020 Convertible Notes | (64,825) | |||
Balance | 3,254,634 | 2,408,312 | 3,254,634 | 2,408,312 |
Accumulated Other Comprehensive Loss [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | (3,544) | (5,871) | (6,503) | (5,307) |
Foreign currency translation adjustment, net of tax | 452 | 288 | 2,636 | (230) |
Unrealized (losses) gains on marketable securities | (282) | (20) | 493 | (66) |
Other comprehensive income (loss), net of tax | 170 | 268 | 3,129 | (296) |
Balance | (3,374) | (5,603) | (3,374) | (5,603) |
Accumulated Deficit [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | (246,511) | (227,291) | (219,451) | (215,159) |
Net income (loss) | 49,922 | (18,458) | 22,862 | (30,590) |
Cancellation of treasury stock | (1,167,905) | (1,167,905) | ||
Balance | $ (1,364,494) | $ (245,749) | $ (1,364,494) | $ (245,749) |
Equity-based Compensation - Nar
Equity-based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands, shares in Millions | Sep. 07, 2016$ / shares | Sep. 30, 2016USD ($)shares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)purchase_periodshares | Sep. 30, 2015USD ($) |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Pre-tax equity-based compensation, included in restructuring expense | $ | $ 13,676 | $ 8,328 | $ 32,031 | $ 31,044 | |
Unrecognized compensation cost | $ | $ 74,800 | $ 74,800 | |||
Weighted average period of recognition of unrecognized compensation cost (years) | 2 years 1 month | ||||
Total intrinsic value of options exercised | $ | $ 700 | 400 | |||
Restricted Stock [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Number of shares awarded and unvested | 2.8 | 2.8 | |||
Aggregate fair value of vested restricted stock | $ | $ 13,100 | $ 1,600 | $ 34,500 | $ 24,700 | |
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Number of shares awarded and unvested | 2.8 | 2.8 | |||
Performance-Based Restricted Stock Awards [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Number of shares awarded and unvested | 0.4 | 0.4 | |||
Performance-Based Restricted Stock Units [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Number of shares awarded and unvested | 0.4 | 0.4 | |||
ESPP Plan [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Shares reserved for issuance | 7.3 | 7.3 | |||
Number of purchase periods | purchase_period | 4 | ||||
Offering purchase period | 6 months | ||||
Offering period | 24 months | ||||
Percentage purchase price of common stock for employees | 85.00% | ||||
TiVo Inc. [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Share price exchange ratio | 0.3853 | ||||
Cash paid per share (in dollars per share) | $ / shares | $ 2.75 | ||||
TiVo Inc. [Member] | Stock Options [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Pre-tax equity-based compensation, included in restructuring expense | $ | $ 3,500 | $ 3,500 | |||
Rovi 2008 Plan [Member] | Stock Options [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Shares reserved for issuance | 29.5 | 29.5 | |||
Shares available for issuance | 12.6 | 12.6 | |||
Vesting period (years) | 4 years | ||||
Contractual term of stock options granted (years) | 7 years | ||||
Rovi 2008 Plan [Member] | Restricted Awards [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Vesting period (years) | 4 years | ||||
TiVo 2008 Plan [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Shares reserved for issuance | 3.7 | 3.7 | |||
Shares available for issuance | 3.7 | 3.7 | |||
TiVo 2008 Plan [Member] | Performance-Based Restricted Stock Awards [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Award requisite service period | 3 years | ||||
Potential shares to be issued upon vesting (percent) | 200.00% | 200.00% | |||
TiVo 2008 Plan [Member] | TiVo Inc. [Member] | Stock Options [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Vesting period (years) | 4 years | ||||
Contractual term of stock options granted (years) | 7 years | ||||
TiVo 2008 Plan [Member] | TiVo Inc. [Member] | Restricted Awards [Member] | |||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||
Vesting period (years) | 3 years | ||||
Award vesting rights (percent) | 17.00% |
Equity-based Compensation - Ass
Equity-based Compensation - Assumptions Used To Value Equity-Based Payments (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility (percent) | 55.50% | 55.70% | 45.00% | |
Expected term (years) | 4 years 1 month | 4 years 1 month | 4 years | |
Risk free interest rate (percent) | 0.90% | 1.10% | 1.30% | |
Expected dividend yield (percent) | 0.00% | 0.00% | 0.00% | |
ESPP Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility (percent) | 50.40% | 56.00% | 55.60% | 53.00% |
Expected term (years) | 1 year 3 months 18 days | 1 year 3 months 18 days | 1 year 3 months 18 days | 1 year 3 months 18 days |
Risk free interest rate (percent) | 0.50% | 0.40% | 0.60% | 0.40% |
Expected dividend yield (percent) | 0.00% | 0.00% | 0.00% | 0.00% |
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility (percent) | 55.90% | 55.90% | 41.00% | |
Expected term (years) | 2 years 8 months | 3 years | 3 years | |
Risk free interest rate (percent) | 1.00% | 1.00% | 1.00% | |
Expected dividend yield (percent) | 0.00% | 0.00% | 0.00% |
Equity-based Compensation - Wei
Equity-based Compensation - Weighted Average Fair Value Per Share Of Equity-Based Awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Stock options | $ 7.21 | $ 10.15 | $ 9.05 | |
ESPP shares | 7.02 | $ 5.12 | 7.30 | 5.33 |
Restricted awards (in dollars per share) | $ 16.70 | $ 13.13 | $ 22.98 | $ 22.27 |
Pre-tax equity-based compensation, included in restructuring expense | $ 13,676 | $ 8,328 | $ 32,031 | $ 31,044 |
Pre-tax equity-based compensation, included in restructuring expense | $ 14,731 | $ 0 | $ 14,731 | $ 0 |
Equity-based Compensation - Sto
Equity-based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended |
Sep. 30, 2016 | |
Options | |
Beginning Balance (in shares) | 3,721 |
Assumed in connection with TiVo acquisition (in shares) | 875 |
Granted (in shares) | 223 |
Exercised (in shares) | (195) |
Forfeitures and canceled (in shares) | (441) |
Ending Balance (in shares) | 4,183 |
Vested and expected to vest (in shares) | 4,040 |
Exercisable (in shares) | 3,318 |
Weighted-Average Exercise Price | |
Beginning Balance (in dollars per share) | $ 30.37 |
Assumed in connection with TiVo acquisition (in dollars per share) | 16.24 |
Granted (in dollars per share) | 23.13 |
Exercised (in dollars per share) | 16.77 |
Forfeitures and cancellations (in dollars per share) | 31.11 |
Ending Balance (in dollars per share) | 27.58 |
Weighted-Average Exercise Price, Vested and expected to vest (in dollars per share) | 27.72 |
Weighted-Average Exercise Price, Exercisable (in dollars per share) | $ 28.65 |
Weighted-Average Remaining Contractual Term, Outstanding | 2 years 9 months |
Weighted-Average Remaining Contractual Term, Vested and expected to vest | 2 years 8 months |
Weighted-Average Remaining Contractual Term, Exercisable | 2 years 1 month |
Aggregate Intrinsic Value, Outstanding | $ 3,873 |
Aggregate Intrinsic Value, Vested and expected to vest | 3,862 |
Aggregate Intrinsic Value, Exercisable | $ 3,790 |
Equity-based Compensation - Res
Equity-based Compensation - Restricted Stock Award Activity (Details) - $ / shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Weighted-Average Grant Date Fair Value | ||||
Granted (in dollars per share) | $ 16.70 | $ 13.13 | $ 22.98 | $ 22.27 |
Restricted Awards [Member] | ||||
Restricted Awards (In Thousands) | ||||
Beginning Balance (in shares) | 3,681 | |||
Assumed in connection with TiVo acquisition (in shares) | 2,409 | |||
Vested (in shares) | (1,578) | |||
Granted (in shares) | 1,338 | |||
Forfeited (in shares) | (303) | |||
Ending Balance (in shares) | 5,547 | 5,547 | ||
Weighted-Average Grant Date Fair Value | ||||
Beginning Balance (in dollars per share) | $ 21.63 | |||
Assumed in connection with TiVo acquisition (in dollars per share) | 22.42 | |||
Granted (in dollars per share) | 21.79 | |||
Vested (in dollars per share) | 22.24 | |||
Forfeited (in dollars per share) | 21.80 | |||
Ending Balance (in dollars per share) | $ 21.83 | $ 21.83 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Effective Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||||
Release of deferred tax asset valuation allowance | $ (88,138) | $ 0 | $ (88,138) | $ 0 |
Foreign withholding tax | 3,316 | 4,080 | 9,759 | 10,737 |
State income tax (benefit) expense | 140 | (229) | 263 | (2,411) |
Foreign income tax | 934 | 649 | 1,771 | 1,775 |
Change in net deferred tax liabilities | 303 | (65) | 1,224 | 3,568 |
Change in unrecognized tax benefits | 0 | (727) | 296 | (745) |
Income tax (benefit) expense | $ (83,445) | $ 3,708 | $ (74,825) | $ 12,924 |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Loss Carryforward (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Federal [Member] | |
Operating Loss Carryforwards [Line Items] | |
Carryforward Amount | $ 1,155,486 |
Federal [Member] | Stock Options [Member] | |
Operating Loss Carryforwards [Line Items] | |
Carryforward Amount | 180,000 |
State [Member] | |
Operating Loss Carryforwards [Line Items] | |
Carryforward Amount | 821,952 |
State [Member] | Stock Options [Member] | |
Operating Loss Carryforwards [Line Items] | |
Carryforward Amount | $ 27,400 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2016 | Sep. 07, 2016 | Dec. 31, 2015 | |
Operating Loss Carryforwards [Line Items] | ||||
Release of deferred tax asset valuation allowance | $ 88,138 | $ 88,138 | ||
Deferred tax asset valuation allowance | $ 449,700 | |||
TiVo Inc. [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Acquired deferred tax assets | $ 51,900 | |||
Federal [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Operating loss carryforwards | 292,700 | |||
State [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Operating loss carryforwards | 46,000 | |||
Valuation allowance | $ 39,900 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)segment | Sep. 30, 2015USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | segment | 2 | |||
Revenues | $ 153,121 | $ 114,882 | $ 396,750 | $ 376,727 |
Adjusted Operating Expenses | 93,307 | 73,233 | 240,566 | 232,966 |
Adjusted EBITDA | 59,814 | 41,649 | 156,184 | 143,761 |
Depreciation | 4,622 | 4,280 | 13,181 | 13,098 |
Amortization of intangible assets | 24,925 | 19,189 | 63,087 | 57,789 |
Restructuring and asset impairment charges | 22,311 | 218 | 24,644 | 1,757 |
Equity-based compensation | 13,676 | 8,328 | 32,031 | 31,044 |
Transaction, transition and integration costs | 13,996 | 0 | 20,039 | 0 |
Earnout amortization and settlement | 319 | (860) | 1,508 | (860) |
Contested proxy election costs | 0 | 0 | 0 | 4,346 |
Change in franchise tax reserve | 0 | 0 | 154 | 0 |
Operating (loss) income from continuing operations | (20,035) | 10,494 | 1,540 | 36,587 |
Interest expense | (11,021) | (11,348) | (32,411) | (35,421) |
Interest income and other, net | 353 | 586 | 322 | 1,089 |
Income (loss) on interest rate swaps | 1,697 | (11,787) | (16,897) | (17,106) |
Loss on debt extinguishment | 0 | (2,695) | 0 | (2,815) |
Loss from continuing operations before income taxes | (29,006) | (14,750) | (47,446) | (17,666) |
Operating Segments [Member] | Intellectual Property Licensing [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 81,823 | 57,520 | 205,802 | 192,271 |
Adjusted Operating Expenses | 19,349 | 15,515 | 51,203 | 47,535 |
Adjusted EBITDA | 62,474 | 42,005 | 154,599 | 144,736 |
Operating Segments [Member] | Intellectual Property Licensing [Member] | Service Provider [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 66,684 | 45,890 | 162,791 | 144,344 |
Operating Segments [Member] | Intellectual Property Licensing [Member] | Consumer Electronics [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 15,139 | 11,630 | 43,011 | 47,927 |
Operating Segments [Member] | Product [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 71,298 | 57,362 | 190,948 | 184,456 |
Adjusted Operating Expenses | 59,807 | 45,811 | 150,957 | 146,959 |
Adjusted EBITDA | 11,491 | 11,551 | 39,991 | 37,497 |
Operating Segments [Member] | Product [Member] | Service Provider [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 59,389 | 48,117 | 162,480 | 149,440 |
Operating Segments [Member] | Product [Member] | Consumer Electronics [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 9,153 | 5,825 | 18,010 | 16,586 |
Operating Segments [Member] | Product [Member] | Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 2,756 | 3,420 | 10,458 | 18,430 |
Corporate [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted Operating Expenses | 14,151 | 11,907 | 38,406 | 38,472 |
Adjusted EBITDA | $ (14,151) | $ (11,907) | $ (38,406) | $ (38,472) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 12, 2016 | Oct. 31, 2016 | Sep. 30, 2016 | Nov. 02, 2016 | Apr. 29, 2015 |
Subsequent Event [Line Items] | |||||
Authorized stock repurchase amount | $ 125,000,000 | ||||
Convertible Debt [Member] | Equity Option [Member] | 2021 Convertible Notes [Member] | |||||
Subsequent Event [Line Items] | |||||
Payments for repurchase of warrants | $ 2,900,000 | ||||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Authorized stock repurchase amount | $ 50,472,600 | ||||
Subsequent Event [Member] | Convertible Debt [Member] | 2021 Convertible Notes [Member] | |||||
Subsequent Event [Line Items] | |||||
Repayments of convertible debt | $ 229,950,000 | ||||
Subsequent Event [Member] | Convertible Debt [Member] | Equity Option [Member] | 2021 Convertible Notes [Member] | |||||
Subsequent Event [Line Items] | |||||
Cash received on hedge | $ 6,400,000 | ||||
Payments for repurchase of warrants | 2,900,000 | ||||
Subsequent Event [Member] | Unpaid Royalties [Member] | Threatened Litigation [Member] | |||||
Subsequent Event [Line Items] | |||||
Litigation settlement | $ 5,000,000 |