Expect a Surprise From TiVo Tonight

TiVo (NASDAQ: TIVO  ) is fresh off a lucrative settlement with Verizon (NYSE: VZ  ) and in the thick of another long-running lawsuit against Google (NASDAQ: GOOGL  ) and Cisco  (NASDAQ: CSCO  ) . The digital video recording veteran takes a break from the courtroom this week, because there's this third-quarter earnings report to prepare.

Analysts expect the numbers to look weak. The average earnings estimate stands at a $0.21 loss per share, same as the year-ago period. That forecast seems to contradict the Street's prediction that revenue will rise 16% to $59.9 million.

Don't be surprised if the analysts turn out to be utterly wrong. TiVo's results are notoriously bumpy and unpredictable. The company has delivered huge surprises both to the upside and downside of analyst targets in recent quarters.

TIVO Revenue Quarterly data by YCharts.

Verizon's early settlement may have lowered TiVo's legal costs and added a one-time cash infusion. Wednesday night's report may very well beat Street targets on these strengths, but the stock could still fall. Management's outlook for the coming quarter is the real game-changer.

CEO Tom Rogers wants to "reinvent television all over again" by making big-screen content management as flexible and intuitive as the best viewing apps on your smartphone or tablet. Give consumers one remote for one set-top box and one content management tool (with TiVo inside, of course), and we'll have another consumer-friendly revolution on our hands.

Look for management to expand and clarify this vision. Any new color commentary on TiVo's long-term business strategy would be very welcome.

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