Xperi Inc. Q1 FY2025 earnings call

• Q1 execution was strong with progress on full year growth goals, including TiVo OS and TiVo One platform rollout, IPTV subscriber growth, and DTS AutoStage footprint proliferation. • Revenue was $114 million, down due to business divestitures in 2024. • Adjusted EBITDA was $16 million, up over 200% from the prior year quarter. • Focus on three growth solutions: connected TV advertising with TiVo One platform, in-cabin entertainment with DTS AutoStage, and TiVo video-over-broadband. • In media platform, rolled out homepage ad unit, Sharp and Skyworth sold TVs powered by TiVo, and launched over 80 content partner applications onto TiVo OS platform. • In connected car, signed two multi-year HD Radio agreements, 15 models launched with HD Radio, and DTS AutoStage had a footprint of 11 million vehicles in over 130 countries. • IPTV had over 2.75 million video-over-broadband subscriber households, a 36% year-over-year increase. • Consumer Electronics signed long-term DTS audio renewal agreements.

Revenue in the first quarter was $114 million. The Pay TV segment had revenue of $50 million, which is a 12% decrease, with strong growth in IPTV contributing to part of the performance. The Consumer Electronics segment was $23 million, a 5% decrease due to softer production volume of certain products. The Connected Car segment was $33 million, a 37% increase mainly due to minimum guarantee licensing arrangements for HD Radio. The Media platform segment was $8 million, a 30% decrease primarily due to lower middleware revenue. Adjusted EBITDA for the quarter was $16 million, which is 14% of revenue, and it was up over 200% compared to the prior year quarter.

• Maintaining the full year outlook despite broad macroeconomic uncertainties. • Tariffs' impact on the business is modest and within planning outcomes. • Adjusted EBITDA margin goal for the year is 16% to 18%, and achieving 14% in a seasonally weaker quarter shows progress towards the goal. • Expect revenue growth through media platform, video-over-broadband, and connected car over the next several years.

• Broad macroeconomic uncertainties. • Tariffs creating a fluid market environment with lower visibility, which may impact TV volume as some is manufactured in Asia and subject to tariffs.

Q: About IPTV user base and monetizing it, A: There's a continued quarter-over-quarter effort to assist with deployments and more wins that will drive subscribership revenue, and video-over-broadband wins will lead to longer tail monetization through ad platform rollouts.

Q: About additional OEMs for TV companies, A: We expect to add at least one to two TV partners in the course of this year beyond the eight we already have.

Q: About active users target and tariffs, A: We had talked about looking to exit the year with 5 million monthly active users and are on track, tariffs create a fluid environment but the plan is still on track.

Q: About macro factors in the guide, A: We are maintaining the guide provided as uncertainties haven't yet impacted the range we set.

Q: About TiVo OS homepage ad unit and ARPU, A: The homepage ad unit is valuable real estate, and it will have a positive impact on monetization as we've done work to ensure successful rollouts and pilots.

Q: About U.S. TiVo OS devices, A: It's early days with Sharp volumes being small, but we expect more TVs with an additional partner to hit the market in the balance of the year and active update programs for settop-box video-over-broadband devices.