TiVo Names Dave Shull as President and CEO and Provides Improved Business Outlook

Dave Shull Brings Significant Operational and Industry Experience to
Implement Previously Announced Strategic Direction

Raghu Rau To Assume Role of Vice Chair of the Board

Company Expecting Solid Second Quarter Financial Results and Raises
Fiscal 2019 Expectations

SAN JOSE, Calif.–(BUSINESS WIRE)–TiVo
Corporation
(NASDAQ: TIVO), a global leader in entertainment
technology and audience insights, today announced that its Board of
Directors unanimously elected Dave Shull to the position of president
and CEO and a member of the Board of Directors, effective May 31, 2019.
Interim president and CEO Raghu Rau will then assume the role of Vice
Chairperson on the Company’s Board of Directors.

“We are thrilled to announce Dave Shull as Raghu’s successor,” said Jim
Meyer, chairman of the Board of Directors. “In addition to Dave’s deep
experience in the Pay-TV, OTT and digital media fields, he has a strong
track record of driving value creating strategic outcomes and
operational transformations, most recently at The Weather Channel and
before that at Dish. Dave knows our industry extremely well, having been
a part of it in senior executive roles for over fifteen years. He also
has significant M&A experience and is the right person to lead TiVo’s
separation process, which we believe will result in significant value
for our stockholders.”

“I want to thank Raghu for stepping in and leading TiVo during this
critical time in the company’s evolution and for the important role he
will continue to play on our Board,” continued Mr. Meyer. “As Vice
Chair, Raghu will provide continuity in ongoing discussions with
strategic parties, continued support on TiVo’s licensing resolution
strategy with Comcast, and additional support as needed in the
separation of TiVo’s two businesses. Raghu’s leadership has resulted in
the planned launch of three new ground-breaking products, continued
growth in our licensing business and the decision on our strategic
direction.”

“I am honored and excited to be selected by the Board to lead TiVo and
its employees, and I look forward to leading the company’s next phase,”
said Dave Shull. “I believe in the company’s strategic direction and my
focus will be on driving the execution of that strategy on both the
separation and potential transaction front. My understanding of the
industry, experience with strategic transactions, and demonstrated
ability to drive cost efficiencies can be instrumental in creating
meaningful value for TiVo’s stockholders.”

Dave Shull has over 15 years of senior leadership experience in the
Pay-TV, OTT and digital media fields. Most recently, he served as the
CEO of The Weather Channel cable network, which was sold in a
competitive bidding process in 2018. While at The Weather Channel from
2015 to 2018, Mr. Shull overhauled the organization to streamline
operating costs, separated the digital assets from its television and
OTT products resulting in the successful sale of its digital businesses
to IBM in 2016, and oversaw record-setting ratings during major
hurricanes. Prior to The Weather Channel, Mr. Shull held various
executive roles at DISH Network/EchoStar for 10 years, including
Executive Vice President and Chief Commercial Officer, Senior Vice
President, Programming, Senior Vice President and Managing Director,
Asia Pacific, and Vice President, Operations. Mr. Shull holds a B.A.
from Harvard University and an M.B.A. from Oxford University.

Raghu Rau, Vice Chairperson of the Board commented, “It has been my
pleasure and an honor to lead TiVo for the last 11 months. My role was
always contemplated to be an interim step, and now is the right time to
transition the leadership to someone who can lead the process for TiVo’s
future. The Board has worked diligently to find a CEO of Dave’s caliber
who can execute on both our strategic direction and the five-pillar
growth with profitability plan that we have successfully developed over
the last year. I look forward to working with Dave to deliver value to
our stockholders.”

Updated Business Outlook

The Company also announced that, based upon improved visibility into its
sales pipeline, it is raising its expectations for Fiscal 2019 from
those provided on May 9, 2019. The Company now expects revenue of $644
million to $660 million, up from previous range of $640 million to $654
million, and a GAAP loss before taxes of $72 million to $80 million,
lowered from the previous range of a GAAP loss before taxes of $75
million to $87 million. Additionally, the Company now expects Adjusted
EBITDA of $175 million to $185 million, up from the previous range of
$172 million to $178 million, and non-GAAP Pre-tax Income of $123
million to $133 million, up from previous range of $120 million to $126
million. TiVo anticipates it will incur $29 million to $30 million in
Cash Taxes based on its operating expectations. Additionally, TiVo
expects its GAAP Diluted Weighted Average Shares Outstanding to be
approximately 126 million and Non-GAAP Diluted Weighted Average Shares
Outstanding to be approximately 127 million.

Additionally, the Company stated that it expects to repay the $345.0
million of currently outstanding 2020 Convertible Notes, by the maturity
date, from its cash, cash equivalents and marketable securities on the
balance sheet and its anticipated operating cash flow. The Company will
also review options to refinance its existing Term Loan B Facility
before separation of the IP Licensing and Product businesses. Finally,
the Company reaffirmed that it expects to complete this separation in
the first half of 2020 through a tax-free spinoff of the Product
business to its shareholders.

Non-GAAP Financial Information

TiVo Corporation provides Non-GAAP information to assist investors in
assessing its operations in the way that its management evaluates those
operations. Non-GAAP Pre-Tax Income and Adjusted EBITDA and are
supplemental measures of the Company’s performance that are not required
by, and are not determined in accordance with, GAAP. Non-GAAP financial
information is not a substitute for any financial measure determined in
accordance with GAAP.

Non-GAAP Pre-tax Income is defined as GAAP income (loss) from continuing
operations before income taxes, as adjusted for the effects of items
such as amortization of intangible assets, equity-based compensation,
accretion of contingent consideration, amortization or write-off of note
issuance costs, discounts on convertible debt and mark-to-market
adjustments for interest rate swaps and interest on escheat liabilities;
as well as items which impact comparability that are required to be
recorded under GAAP, but that the Company believes are not indicative of
its core operating results such as goodwill impairment, restructuring
and asset impairment charges, separation costs, transaction, transition
and integration costs, retention earn-outs payable to former
shareholders of acquired businesses, earn-out settlements, CEO
transition cash costs, remeasurement of contingent consideration, TiVo
acquisition litigation, expenses in connection with the extinguishment
or modification of debt, gain on settlement of acquired receivable,
additional depreciation resulting from facility rationalization actions,
other-than temporary impairment losses on strategic investments, gains
on the sale of strategic investments and changes in acquired escheat
liabilities.

Adjusted EBITDA is defined as GAAP operating income (loss) excluding
depreciation, amortization of intangible assets, goodwill impairment,
restructuring and asset impairment charges, equity-based compensation,
strategic review costs, separation costs, transaction, transition and
integration costs, retention earn-outs payable to former shareholders of
acquired businesses, earn-out settlements, CEO transition cash costs,
remeasurement of contingent consideration and gain on settlement of
acquired receivable.

Cash Taxes are defined as GAAP current income tax expense excluding
changes in reserves for unrecognized tax benefits.

Non-GAAP Diluted Weighted Average Shares Outstanding is defined as GAAP
diluted weighted average shares outstanding except for periods of a GAAP
loss. In periods of a GAAP loss, GAAP diluted weighted average shares
outstanding are adjusted to include dilutive common share equivalents
outstanding that were excluded from GAAP diluted weighted average shares
outstanding because the Company had a loss and therefore these shares
would have been anti-dilutive.

The Company’s management evaluates and makes decisions about its
business operations primarily based on Non-GAAP financial information.
Management uses Non-GAAP financial measures as the basis for
decision-making as they exclude items management does not consider to be
“core costs” or “core proceeds”. For each Non-GAAP financial measure,
the adjustment provides management with information about the Company’s
underlying operating performance that enables a more meaningful
comparison to its historical and projected financial performance in
different reporting periods. For example, since the Company does not
acquire or dispose of businesses on a predictable cycle, management
excludes the amortization of intangible assets, separation costs,
transition and integration costs, retention earn-outs payable to former
shareholders of acquired businesses, earnout settlements, CEO transition
cash costs, remeasurement of contingent consideration, TiVo Acquisition
litigation, and gain on settlement of acquired receivables from its
Non-GAAP financial measures in order to make more consistent and
meaningful evaluations of the Company’s operating expenses as these
items may be significantly impacted by the timing and magnitude of
acquisitions. Management also excludes the effect of goodwill
impairment, restructuring and asset impairment charges, expenses in
connection with the extinguishment or modification of debt, gain on the
settlement of acquired receivable, additional depreciation resulting
from facility rationalization actions, other-than-temporary impairment
losses on strategic investments, gains on the sale of strategic
investments and changes in escheat liability. Management excludes the
impact of equity-based compensation to provide meaningful supplemental
information that allows investors greater visibility to the underlying
performance of our business operations, facilitates comparison of our
results with other periods, and may facilitate comparison with the
results of other companies in our industry, as well as to provide the
Company’s management with an important tool for financial and
operational decision-making and for evaluating the Company’s performance
over different periods of time. Due to varying valuation techniques,
reliance on subjective assumptions and the variety of award types and
features that may be in use, we believe that providing Non-GAAP
financial measures excluding equity-based compensation allows investors
to make more meaningful comparisons between our operating results and
those of other companies. Management excludes the accretion of
contingent consideration, amortization or write-off of note issuance
costs and discounts on convertible debt, mark-to-market adjustments for
interest rate swaps and interest on acquired escheat liability when
management evaluates the Company’s expenses. Management reclassifies the
current period benefit (cost) of the interest rate swaps from gain
(loss) on interest rate swaps to interest expense in order for Non-GAAP
Interest Expense to reflect the effects of the interest rate swaps as
these interest rate swaps were entered into to control the effective
interest rate the Company pays on its debt.

Management uses these Non-GAAP financial measures to help it make
decisions, including decisions that affect operating expenses and
operating margin. Management believes that making Non-GAAP financial
information available to investors, in addition to GAAP financial
information, may facilitate more consistent comparisons between the
Company’s performance over time with the performance of other companies
in our industry, which may use similar financial measures to supplement
their GAAP financial information.

Management recognizes that these Non-GAAP financial measures have
limitations as analytical tools, including the fact that management must
exercise judgment in determining which types of items to exclude from
the Non-GAAP financial information. In addition, as other companies,
including companies similar to TiVo Corporation, may calculate their
Non-GAAP financial measures differently than the Company calculates its
Non-GAAP financial measures, these Non-GAAP financial measures may have
limited usefulness to investors when comparing financial performance
among companies. Management believes, however, that providing Non-GAAP
financial information, in addition to GAAP financial information,
facilitates consistent comparison of the Company’s financial performance
over time. The Company provides Non-GAAP financial information to the
investment community, not as an alternative, but as an important
supplement to GAAP financial information; to enable investors to
evaluate the Company’s core operating performance in the same way that
management does. Reconciliations for each Non-GAAP financial measure to
its most directly comparable GAAP financial measure are provided in the
tables below.

 

TIVO CORPORATION AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FORECAST FINANCIAL
INFORMATION

(In millions)

(Unaudited)

 
    FY 2019 Expectations
Low     High
GAAP loss from continuing operations before income taxes $ (72 ) $ (80 )
Amortization of intangible assets 113 113
Restructuring and asset impairment charges 2 3
Equity-based compensation 36 38
Separation costs 25 40
Transition and integration costs 1 1
Amortization of note issuance costs and convertible note discount 16 16
Mark-to-market loss related to interest rate swaps (1) 2   2  
Non-GAAP Pre-tax Income (1) $ 123   $ 133  
 
Cash Taxes $ 29 $ 30
 

(1) Due to their nature, changes in the mark-to-market of interest rate
swaps have only been included in the outlook to the extent they have
already occurred. Actual results may differ materially from the outlook.

   
FY 2019 Expectations
Low     High
GAAP Operating loss $ (25 ) $ (33 )
Depreciation 23 23
Amortization of intangible assets 113 113
Restructuring and asset impairment charges 2 3
Equity-based compensation 36 38
Separation costs 25 40
Transition and integration costs 1   1  
Adjusted EBITDA $ 175   $ 185  
 
   

FY 2019
Expectations

GAAP Diluted weighted average shares outstanding 126
Dilutive effect of equity-based compensation awards 1
Non-GAAP Diluted Weighted Average Shares Outstanding 127
 

About TiVo

TiVo (NASDAQ: TIVO) is a global leader in entertainment technology and
audience insights. From the interactive program guide to the DVR, TiVo
delivers innovative products and licensable technologies that
revolutionize how people find content across a changing media landscape.
TiVo enables the world’s leading media and entertainment providers to
deliver the ultimate entertainment experience. Explore the next
generation of entertainment at tivo.com, forward.tivo.com or follow us
on Twitter @tivo or @tivoforbusiness.

Caution Concerning Forward-Looking Statements

This release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements
relate to, among other things, the success of the Company’s plans to
separate the Product and IP Licensing businesses into two independent
companies, intended repayment of convertible senior notes with cash flow
from its balance sheet and operations, and estimated future financial
results. These forward-looking statements are based on TiVo’s current
expectations, estimates and projections about its business and industry,
management’s beliefs and certain assumptions made by the company, all of
which are subject to change. Forward-looking statements generally can be
identified by the use of forward-looking terminology such as, “future”,
“believe,” “expect,” “may,” “will,” “intend,” “estimate,” “continue,” or
similar expressions or the negative of those terms or expressions. Such
statements involve risks and uncertainties, which could cause actual
results to vary materially from those expressed in or indicated by the
forward-looking statements. Factors that may cause actual results to
differ materially include, for reasons inside or outside the Company’s
control, delay or failure to accomplish the planned separation of the
Company’s Product and IP Licensing businesses, changes in the Company’s
financial condition and results of operations impacting its ability to
repay the convertible senior notes with cash flow from its balance sheet
and operations, delays in development, the failure to deliver
competitive service offerings and lack of market acceptance of any
offerings delivered, as well as the other potential factors described
under “Risk Factors” included in TiVo’s Quarterly Report on Form
10-Q for the three months ended March 31, 2019 and Annual Report on Form
10-K for the year ended December 31, 2018 and other documents of TiVo
Corporation on file with the Securities and Exchange Commission
(available at www.sec.gov).
TiVo cautions you not to place undue reliance on forward-looking
statements, which reflect an analysis only and speak only as of the date
hereof. TiVo assumes no obligation to update any forward-looking
statements in order to reflect events or circumstances that may arise
after the date of this release, except as required by law.

TiVo and the TiVo logo are registered trademarks of TiVo Corporation
and its subsidiaries worldwide.

Contacts

Investor Relations
Debi Palmer
TiVo
Corporation
+1 818-295-6651
debi.palmer@tivo.com

Press Relations
Lerin O’Neill
TiVo
Corporation
+1 408-562-8455
lerin.oneill@tivo.com

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