What happened?

Shares of TiVo (NASDAQ:TIVO), a global leader in entertainment technology and audience insights, were down 15% Friday afternoon after fiscal 2019 first-quarter results and a company breakup plan failed to inspire investors.

So what

Starting with first-quarter results, total revenue was down 16.6% to $158.24 million, in line with analysts' estimates. The bottom line declined, with a loss of $0.21 per share, versus the prior year's loss of $0.16.

Man holding a remote watching television

Image source: Getty Images.

In a press release, interim CEO Raghu Rau said:

Management has, and will remain, focused on driving growth with profitability by executing the previously announced five pillars of growth with profitability strategy. On the product side, we announced our first IPTV deployments of TiVo User Experience 4. Additionally, we are on track to launch several new products and business models in the second half of the year. 

Now what

In addition to announcing its first-quarter results, TiVo's board decided to separate its Product and IP Licensing businesses in an effort to maximize shareholder value. Management believes that these two entities will have more operational flexibility to pursue growth opportunities, and that separation is the best strategy currently available. It had considered anything from a total sale to going private.

One could speculate that TiVo's 15% decline today suggests investors aren't buying that the plan will improve growth opportunities. What this does appear to do, at the very least, is make both assets separately more attractive and valuable to potential buyers who weren't as interested in the company as a whole.