October 8, 2002 1:15 PM PDT

TiVo sells stock to fill the till

Related Stories

DirecTV fine-tunes TiVo deal

February 21, 2002

TiVo's year-end sales appear strong

December 26, 2001

Sony to plug TiVo into its products

October 18, 2001
TiVo plans to raise $25 million in a stock sale with the goal of reaching profitability by the end of the year.

The San Jose, Calif.-based company announced Monday that Crosslink Capital and New Enterprise Associates will buy $25 million worth of the company's stock.

TiVo, which offers digital video recording services to record and replay shows at will, plans to sell 6.96 million shares at $3.59 per share--a 3 percent premium over the stock's average closing price for the last 10 days. TiVo will also issue warrants for the purchase of 2.6 million shares of common stock at $5 per share.

Cash remains a key issue for the company, according to Matthew McCormack, a financial analyst with Freidman Billings Ramsey.

"Liquidity has remained a concern from the early days, when the company spent hundreds of millions of dollars on branding and subsidizing manufacturers' costs," McCormack wrote in a research note Tuesday. "We now expect TiVo to end the year (and reach profitability) with $40 million in cash."

Over the last few quarters, the company has been focusing on lowering operating expenses while expanding the number of technology and services licenses.

Analysts have said that the restructuring of its deal with DirecTV and a licensing deal with Sony have improved the company's outlook.

The company said in a release that it will use the sell-off proceeds for general corporate purposes and to supplement working capital.

 

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot

Discussions

Shared

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.