Xperi Inc ((XPER)) has held its Q1 earnings call. Read on for the main highlights of the call.
Xperi Inc’s recent earnings call presented a mixed sentiment, showcasing both achievements and challenges. While the company celebrated significant growth in adjusted EBITDA, connected car revenue, and IPTV subscribers, these positives were tempered by declines in overall revenue, Pay TV revenue, and media platform revenue. Despite these hurdles, Xperi remains optimistic about its future growth prospects in strategic areas.
Strong Adjusted EBITDA Growth
Xperi Inc reported a remarkable increase in adjusted EBITDA, reaching $16 million for the quarter. This figure represents 14% of the company’s revenue and marks a substantial 200% growth compared to the $5 million reported in the same quarter last year. This growth underscores the company’s ability to enhance its profitability despite facing revenue challenges.
Connected Car Revenue Surge
The earnings call highlighted a 37% surge in connected car revenue, amounting to $33 million. This growth was driven by minimum guarantee licensing arrangements for HD Radio, although it was partly offset by lower automotive volumes. This segment’s performance reflects Xperi’s strategic focus on expanding its footprint in the automotive industry.
IPTV Subscriber Growth
Xperi’s IPTV segment showed impressive growth, ending the quarter with over 2.75 million video-over-broadband subscriber households. This represents a 36% year-over-year increase, indicating strong consumer demand for Xperi’s broadband video services.
Successful Rollout of TiVo One Ad Platform
The company successfully rolled out the TiVo One ad platform, achieving 2.5 million monthly active users by the end of the quarter. The introduction of a new TiVo One homepage ad unit is expected to further enhance user engagement and advertising revenue.
Overall Revenue Decline
Despite the successes in specific segments, Xperi’s total revenue for the first quarter was $114 million, a 4% decrease from the previous year’s $119 million. This decline reflects broader challenges in the company’s revenue streams.
Pay TV Revenue Drop
The Pay TV segment experienced a 12% decline in revenue, dropping to $50 million. While IPTV showed strong growth, it was not enough to offset the decrease in the core Pay TV business, highlighting a shift in consumer preferences.
Decline in Media Platform Revenue
Media platform revenue fell by 30% to $8 million, primarily due to lower middleware revenue and a time shift of advertising commitments. This decline underscores the challenges faced in maintaining media platform profitability.
Forward-Looking Guidance
Looking ahead, Xperi remains committed to its strategic initiatives, focusing on connected TV advertising, in-cabin entertainment, and TiVo video-over-broadband services. The company aims to double its TiVo One ad platform users to 5 million by year-end and continues to see growth in video-over-broadband subscribers. Despite macroeconomic uncertainties, Xperi maintains its financial outlook for the year, supported by improved operational efficiencies and strategic growth solutions.
In conclusion, Xperi Inc’s earnings call reflects a company navigating through both opportunities and challenges. While certain segments demonstrate robust growth, overall revenue declines pose ongoing challenges. Nevertheless, Xperi’s strategic focus and operational improvements provide a foundation for potential future success.