Rovi shares soared more than 15% Friday after the company posted Q4 results that beat analyst expectations.
Rovi, a key maker of interactive guide technology and a major supplier of metadata, pulled down Q4 net income of $26.3 million (65 cents per share), on revenues of $149.5 million, up 11% on a year-over-year basis. Analysts were expecting earnings of 40 cents.
Rovi attributed the rise in revenue in part to catch-up payments from AT&T and Sony. Rovi posted service provider revenues of $124 million in Q4, up 18%.
On Thursday’s earnings call, Rovi CEO Tom Carson said the strong quarter was “led by licensing,” noting it had renewed its intellectual property deal with AT&T (which acquired DirecTV last year), Sky, Europe’s largest pay TV operator, and inked a new deal with Canadian operator Shaw Communications. The Shaw deal, he said, includes its new Free Range TV mobile video app, which is powered by Comcast’s X1 platform.
Rovi has also salted away a multi-year license with Charter Communications, which is in the process of acquiring Time Warner Cable and Bright House Networks.
“Assuming the Time Warner Cable acquisition closes, we will have two of the big four U.S. service providers under new contracts,” Carson said.
Carson said Rovi is working to get renewals done with the other two – Comcast and Dish Network.
But it’s not counting those chickens yet. Rovi forecasted 2016 revenues of $490 million to $520 million, and earnings of $1.35 to $1.65 per share. “We are excluding any revenue associated with renewing these two deals from our estimates, including any advertising or TV Everywhere revenues from Comcast after Q1,” Carson said.
In addition to getting those renewals done, Rovi said another big focus this year involves Fan TV, the video navigation platform Rovi acquired in 2014for $12 million.
Though IP-connected Fan TV devices are no longer part of Rovi’s game plan (Time Warner Cable stopped selling those last fall), Rovi has since evolved Fan TV into a modular entertainment discovery platform for service providers and developers, offering it via APIs, apps and as an operating system for set-top boxes.
Carson said a “large European service provider agreed to use the Fan TV platform,” but won’t be saying more until after that customer announces their product and service plan that will rely on Fan TV.
Rovi said it expects to announce new deals for Fan TV, both as a full solution, and as an element that complements other discovery services during the course of the year.
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