XPER - Earnings call transcript Q1 2022 | Xperi Holding Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, everyone. Thank you for standing by. Welcome to Xperi First Quarter 2022 Earnings Conference Call. [Operator Instructions]. I would now like to turn the call over to Jill Koval from Xperi. ahead. go please Jill,

Jill Koval

Officer; and first for With quarter today Chief the everyone, Officer. Chief we me us report call Executive Kirchner, Jon our XXXX are Robert thank afternoon, Andersen, joining Financial you as on and Good financial results.

access today's website. can with addition which to an presentation, on there earnings, In the also webcast is earnings you along IR our

like begin, provide X I would to we Before reminders.

that based First, future are management's contains today's statements predictions, about beliefs are forward-looking other changes in and to events, or expectations circumstances. which subject risks, on and projections current statements therefore, discussion and uncertainties

For in more XX-K. after discuss these to forward-looking on risks SEC our we the call. today, to results intend that on our company could and the Report uncertainties to arising not statements alter information our filings, actual cause what the materially including circumstances to please this section from Factors Annual differ refer or that or Please note update events Form reflect Risk does

we related stock-based and debt measures, costs non-cash severance, charges, expense fees, closures to costs, amortization exclude separation planned bonuses, related intangibles and acquired one-time on effects. or costs ongoing integration Second, non-GAAP actual combinations, tax which including certain facility business compensation, transaction refinancing or loss retention costs, to financial extinguishment, refer debt

Xperi's The www.xperi.com. of to call website. in Relations website GAAP We Investor release have our turn provided be I'll CEO, reconciliations of and Relations Jon of available now the to call the the will earnings measures section our the these directly comparable this non-GAAP at Kirchner. over most on measures on conference Investor recording

Jon Kirchner

joining thank and Jill, us. you, you, everyone for Thank

quarter quarter and in combined revenue to to of the was earnings a the progress QX XXXX, license. from our while financial a per compared results non-GAAP first the XXXX, announced $X.XX priorities confidence million, continue for of Micron making our earnings XX% strategic representing first GAAP the to against basis, first $X.XX previously environment, to QX volatile XXXX. increases primarily trajectory. our we year On share compared of the macro the $X.XX in $X.XX in quarter we're $XXX that was growth continued in full of our per our operate demonstrate due While was share total

on internal business. capabilities, at home is experiences as leading the well more At acquisitions on world, same strategic Product a our in time, and focused provide of millions through me more business later intellectual with positioned focused of its innovations, previously update separate on and business. a Xperi broader in the property We Adeia to Adeia this patent relevance media, portfolios. nimble portfolios consumers that well to stand-alone will and quick Product Xperi of products and and investments and Let how it behind around fall publicly connect that business and its personal. be X and extraordinary intelligent, and into a Adeia, to strategy as on are will important targeted companies, announced our content patent for go set grow will principally The the continue management track adoption traded IP and Xperi extend unique strategy licensing of become its its execute separation. to immersive Licensing our size across ongoing is the innovations on entertainment the audiences semiconductor our through creating way With industries. to remain continue for elevating of

primary infotainment management the We discovery, of as accomplish TVOS and growth enabling by United safety we for are the demand TV ways: a meeting growth IPTV abroad, and by our the to for establishing excited Tier advanced TV-based monetization in which leading and makers. entertainment for by in X States faster X potential of intend in-cabin the this and business, cars in by platform

to continue unlocking believe positioned meaningful over businesses platforms will grow the business and long to of for pure-play these term, be We compete enable reduce value shareholders. separation to better complexity these X and thereby

Focusing team within in on IP which homegrown. of IP sophisticated our nearly assets, separation, XX% excited a a about R&D our to that continuous and We've in innovate and business. built portfolio breadth support and long-standing funnel Adeia, semiconductor long-term quality our complete license entertainment, built very to positioning XX,XXX new the addition diverse patent for The we've to we're been preparation In Adeia almost social will key the companies. agreements to contributor are that with R&D continue and planned media-focused with has consumer ability function world-leading semi platform and in our media innovation is our addition business. of our separate to of media, the electronics, needs a of renew

and Adeia's foundation We its for journey visibility the streams a to future have strengthen revenue worked company. and as successful to stand-alone around diligently and its preparation sustainability enhance

as During video the with Adeia's which streaming quarter, a services. over importance entered longevity of the portfolios emphasizes a programming further customers, renewal OTT intellectual agreements distributor, license into including continued XX XX property new top Adeia's with or renewed Pay we it and long-term to into virtual expands TV multichannel

on XXXX, in it it the Telus confident cases market-based resolution licensing of our close We the second judgment remain in Additionally, against relevance on to Canadian In date ultimately Videotron to the a very discussions its court achieve X, although June and the always difficult. other to Canada, timing promptly our the we that our IP our will judgment. ability predicting intends anticipated portfolio it and of we litigation, initial of case in that our significant issue against in the Videotron indicated judgment expect in is after Friday, and parties continue to issues advise quarter. the progress initial Bell that

Videotron against rounds litigation and reminder, a Bell last we As of Canada second year. also filed

business. Moving our Product to

strategically to as the we've emerges profitable Over growth transform and business for the it as independent company. past X years, an position worked

We Media in Platform the Pay Connected categories: strategic Car our initiatives and to continue X space. TV, advance Electronics, product Consumer

category product Pay Our hardware. solutions, TV IPTV subscribers Linux TiVo content discovery, platforms, consumer includes guides, and TV classic

Our as traditional long-term in IPTV product new driving declines market focus business. to as new decline higher-value our grow add from a We're business. pleased including Communications. our expanded quarter-over-quarter. a around category offset Notably, Total Pay positioned guides we double-digit our IPTV expanded adoption of slightly basis NfinityLink offset the offerings our from our we've subscriber to guides IPTV grew the TV subscribers win which continued solutions, is through IPTV year-over-year traditional our offerings, continue than at this in on growth more a to made are rate operators with with product progress with

which is Consumer in and includes imaging mobile, DTS audio category home Our and Enhanced licensing IMAX solutions business. second product Perceive and Electronics, our

Buy TV and we with During soundbar Skyworth and expanded Best And signed products. TV Play-Fi TCL soundbar for and their and support with key renewals our we decoder products. relationship include in post-processing licensing the quarter, to

our Looking and normalize the growth product game grow and category the Consumer wireless business. Electronics forward, to as we expect in for to supply begins for this Play-Fi consoles mobile chain year

first from part of and see the to come growth market technology late Enhanced expansion products the in to We of as XXXX. utilizing ecosystem come first expect Perceive expect we our from XXXX IMAX our additional to or

HD Car DTS Connected third Radio, Music is chain monitoring. product Car, Connected supply AutoSense. AutoStage to by we be includes Metadata, which Our constraints, DTS are and continues which closely category impacted

supply and more model an are the that We mitigate quarter stabilizes. important chain try iX countries. anticipate deliver shortages our into of with partners the to first from impact improving DTS key expanded working technology shipments the the with half in components include our to BMW's back few that of highlights as A could AutoSense-enabled XXXX situation

countries. advanced customers we in the also a Business Neuromorphic and European XXXX pipeline by advanced was for U.S., And shipments OEM to and finally, Likewise, Monitoring Monitoring numerous Intelligence Solution Excellence Award chosen more Group. DTS models Driver DTS Occupancy Winner companies. Intelligence than engagement for with the Europe We over of quarter, the Artificial as development car AutoStage-enabled our Asian further AutoSense Mercedes-Benz with expanded Solutions XX Asia. And the presented

Media and focused driven powered XXXX. TVs late by Stream time, partnerships expansion the with we Stream content Our in and we're fastest-growing OEMs, this our Stream on first Platform, TV double-digit This providers in XXXX, our is chipset fourth OS in or which OS, same category, final XXXX partners expect and advertising-based captures monetization monetization early data. growth At TiVo product category revenue. the the bring viewership by to category is mostly and XK, TV the TiVo in TiVo

quarter, we Stream OS, TV viewing TV the TiVo XK TiVo of and into YouTube integration live the premium strengthening Stream experience. the During announced

for Connected advertisers. Xtend, that TiVo launched enables reach incremental and opportunities solution end-to-end Additionally, advertising we frequency an TV

that, We to chipset Robert? ecosystem OEMs content I'll call turn also financials. Robert over the our partners, across Stream With the advanced and to TiVo development discuss providers.

Robert Andersen

Jon. Thanks,

deal million IP As from we of $XXX principally to off deployments, our business $X have to both product the a the a quarter XXXX, previously in was product settlement continued from the IP slightly in quarter first our of X% IPTV Pay the year $XX to principally $XXX first which Revenue that approximately revenue with the quarter, million, the past of churn quarter of revenue business. first to of the new revenue quarter occurred year from from fiscal million, due was shipments million category, an quarter compared million down QX of due announced first year, The MobiTV has XXXX of for TV last million to due of $XXX was due customer $XXX subscribers. up Licensing a growth revenue XX% in offset increase unit higher $XXX represented our ago up generated by Product TV from Pay and in XX% Micron. revenue, good the XXXX. in legacy start. total first customer for noted, gotten XX% primarily to Total million, in

total Consumer to quarter of the category, $XX for of Electronics Moving accounted XX% million revenue. revenue product in

in year-over-year previously the of the is category XXXX. $X last otherwise in to we exhibited $X something category customer revenue year, down first in have growth, expect category due quarter was to While mentioned would for of settlement which the the million occur million the

current continued realized million quarter flat constraints constraints. of our environment, $XX earlier. Media was Platform, $X Because Jon this the of year-over-year XX% category the year the in $XX the of category of Our quarter the million revenue versus first supply for Connected In category, quarterly macro product to expect revenue to year-over-year. improving chain in second half up Car XXXX noted as be we due chain final supply with first million,

of to primarily cost for X% XXXX, MobiTV, grow double TV in our just paid non-GAAP sold by to income QX $XX the up was expect X% category personnel were the currently slightly from On due of inclusion $XXX fully $X expense we Platform of a non-GAAP in expenses year. XXX for expense of tax and While was Cash basis, total was Connected Media digits this $X driven acquired costs from QX and operating QX down accounts the Using million, goods from million. only interest we earnings higher million. shares in quarter, taxes XXXX was non-GAAP revenue, product primarily was and other in cash Non-GAAP quarter million, share $X last mid-XXXX. $X.XX. million million diluted which per advertising.

lower the $XXX debt in balance million quarter accrued Net $XX during our We quarter paid flow another $XX at cash compensation and for $XX Operating end $XXX million the sheet. to for Moving interest and cash taxes. this investments. of payments QX of quarter, $XXX XXXX was $XXX the quarter to from million. debt quarter from million ago. XX% bring million, reduced was due a to million cash million, up balance down to primarily year with finished debt expense lower down past We the

share During stock, we $X.XX authorization. dividend on repurchased cash $XX of and a our stock million paid share leaving repurchase quarter, $XX existing the per of remaining of common million

full the and quarter made are have Given to-date, XXXX. good past progress previously we our announced guidance start reiterating year this for the we

our for not range disputes. risk settlement in business. a benefit year expectations growth license includes for noted the supply does to allows and year the around factors from full Micron Revenue Adeia the revenue and outstanding both As guidance Product revenue are quarter, Also, include of significant last the guidance chain of attributable challenges.

allocation, quarter, we last to sequentially With continue amortization increase expect paying and noted making capital respect year. each quarter scheduled payments. the of to debt As dividend quarterly to we spending plan our

That each address to needs of concludes as business maintaining for our We buy an also back plan we basis, plan on shares prepared opportunistic separation. flexibility while the capitalization to remarks.

questions. open the call now Operator? to Let's your

Operator

with question Instructions]. Galinko Group. [Operator We'll our take Matthew Maxim first from

Matthew Galinko

Car Connected of just constraints you start the of the Maybe half chain could we help back supply if we in think the should some year? strengthening curious us there? expectations linearity? of how wane of year. Is to kind half about the year? I'm the that to back for guess assumptions in of I start understand Do expect sort the with

Robert Andersen

thing. Matt, this is Sure Robert.

as constraints ease supply moment up chain as much at year. automotive of the the that So we expect second would can we in for the half tell

And projections so that's for outlook. within our annual our

Matthew Galinko

might we us I like of Okay. growth what maybe business Can the business? then expect annually, through the And it that and it kind think you or And the look nice should help quarter-to-quarter? this -- help business, but guess us was understand year? the a in seasonality on Media was the Platform What that again, linearity the of puts gauge are I sequentially, decline. takes that's

Robert Andersen

I'm some QX. we'll just taking Yes, a I and in puts given look quarter, takes any think at see Matt.

wouldn't to our I look any at quarter basis. representation, tend still on annual particular numbers an So you overread linear

expect we particularly quarters. on look that's don't a term -- to grower. or directional it's there's sequential do very So important in me, But excuse be that anything a in I I high taking think year-over-year a at think

Jon Kirchner

being coming user of may would engagement scale are how in meaningful devices still also And of continues that But this the respect long-term grow of it on we're just building and Yes. to various a very that we Matt, as I around quarter-to-quarter. see online, scale expect of the I growth continues what's to process as to components early as prognosis pipeline add depending think the our monetized business. result, you the in move platform is increase. and ultimately with driving number capable out

Matthew Galinko

and I for Got it. products. also the one product me, business That's that on helpful. OS in out guess And of door the just terms last in getting to

I pretty said you you are are and what more selling to think hurdles work -- but ramp can going then? be major sense a us XXXX the that late I between you there's done, now be guess -- And your mean, XXXX, and -- products? any early I Is of you based of to can be on or as plenty today, to there think it's rapid in first there? year to engagements accelerating initially relatively you be that a whether momentum uptake expect a give get do X then small the you or on

Jon Kirchner

We lead the call have think be, a I depending the discussions on the in it, think very of none number I how of differ range pipeline small. will evolves. rates that But a I to outcomes, think which, RAM pipeline going could on let's of

platform going will, focused if very over the discussions we're you good. our and are we're based a ramp feedback the think broadly being, period, ecosystem very approach some experience with of multiyear think I I much dribble and nature our pleased the our quality getting how of of this a on more rather, not user within is slow and a but on the of

going. this have space say and with So to I a But we're in the to we'll broadly how think specific TV very further we as pleased are it more little discussions discussions with the ecosystem bit along. now partners more get the say, suffice on

Operator

next our Financial. take with We'll Khorsand question from BWS Hamed

Hamed Khorsand

were how are when So you this first many constructive versus as virtual And MVPD are the rates renewals now more this year? expecting the far question as renewal, first with of signed? conversations they these

Jon Kirchner

the consistent rates we do we being good across how about lines. job business various incredibly approach an I think of

well we've us patent which apart, to size relevant as the of I one think portfolio, time, and continues the discipline the be over that operators quality in of as things said, that that as sets is to very space.

in renewals think I terms hold to consistent our typically renewals we number significant There and and in relevance. to a are size more can going the short, to of continue of the as maybe be the always got times, on number broadly year. aggregate it at where So of in continue don't be given approach. We to misleading any because you've to differences in talk pipeline exact line

at important rate. So what's I high renewing is very think people are

to confidence speaks to and to and ability to we're the to our and this portfolio degree doing it expand. And the we've continue the think forward. to continue business I what we the innovate with built and of have years, again, quality as move think over relevance look ahead I high of next few look a respect we

Hamed Khorsand

in assume of Okay. do to Micron. has to the And has given much one just then with that here performance it Robert, QX,

happen would below the the go of could bottom what top -- happen need to what range? or reach Xperi end underperform And for end or the you So happen of range? exceed to that the

Robert Andersen

to think important high business We into remainder point QX comfortable year. see and of knew consideration would out with it's that that range And very the had the I that still that for be Well, we're takes set opportunities for provided. we quarter itself in we various a we risks deal guidance the gave year. we Micron the when because the the range

question, to how a I from on go it perspective. think supply chain your depends things As

Platform end, within higher outcomes also IPTV business, for in unit Consumer services and could monetization and would IP right? You improved in Electronics higher the say then we within growth per reports ad OTT. Licensing also expect the On favorable Media

in I outcomes that of we've delayed reports some for lower with expect I lower the we're Electronics. IP monetization supply out of then of Licensing. delayed and converse on described, year. laid roll-out the just services, range comfortable issues the again, But quite I to and range, think ad results Consumer what think would and which the IPTV And end persist we the lower unit really in extent, of chain the to there per

Hamed Khorsand

And macro conversations Okay. given having now, that just the the you has time reported? given environment since changed then you're the last the tone

Robert Andersen

of macroeconomic a laid we kind when saw challenges. out couple we certainly gave seeing we as But consideration I broader guidance are that the mean, we those took into and of months in reality, ago year.

I think we've So something while taken -- environment we into challenging, certainly the is consideration. I think that's

Operator

final We'll Shannon question from Craig-Hallum. Richard with take our

Richard Shannon

all grow within quick Thanks, kind taking questions. for Robert, the quarter, make want as to I a Robert, the but moving sure just out year, heard my of I X confirmation great. Is last parts just Well, Jon got I the that to guess, the make business same you them through I to one. that has on unchanged. I all just and were the Products correct? said want of was the X of X. sure that

Robert Andersen

Yes. There's our no change views. in

I'm I substantially quarter they changed. fact, they well, just In haven't last because for wrote looking -- what at really haven't

if cover be can again it I So helpful. them would

Richard Shannon

one No, then is I got the sure want If I no the X to fine. X, fourth problem. of it so just make is,

You again. on don't one touch that need to

IPTV will growth this in us seeing quarter first that year? what there -- suggests about help the some probably Second growth I that And the Can see declines because kind you question overcoming Jon. you've of on talk Pay the business. think I upside remarks for about you prepared IPTV of trends about declines If for there? over said talked the IPT TV, growth. the guide rest think the in collect comment the topic Does offset your could of you're guys are

Jon Kirchner

Sure.

to We've it's is substantial of whether depending a fully be. offsets. partners course, what call the slightly working which even IPTV nearly for net grows maybe will on decline hard very coming it determine to, is rate difference or of got and support. deployments, we're rate and hard that what I pipeline the relative it to business to offsets think going on exactly Depending of the

expectation for versus fair decline and rate I to And think our of you'll analysis. that I flat of a everyone So -- that's is -- a industry us. of see final IPTV growth will think with course, year, determine sub with relative but growth continued it's down consistent amount on not masking, that rate slightly decline, Pay of currently TV which meaningful the expects the trends that's comparison

drag to with done late like. to transform I in of we is through more think say look But economy and move scale, business, overall next we'll get to normalizing think to large view on I is of working TV think in ultimate as to year but we not a a the deployments half have an are build have lies, where as to the two. maybe profitability a going business and to outstanding better way ever continue back we we rather of shift what job future the working or that beginning more where around the business and it summer towards work Pay that we're the

Richard Shannon

Okay. if rate think that topic remarks quarter-on-quarter. IPTV rest even continue And or subs presentation of your you the it front for had in in you have the you suggest double-digit to me or year? I it of maybe follow the kind to year the first Is a on here, or relate total talked the I Pay -- up was of average expectation could on at of the the of quarter TV, to about of rest how kind the is that grow

Jon Kirchner

attractive quarter-on-quarter. it grow yes, put, rate continue at to Simply will a

Richard Shannon

Okay.

questions me, the for line. Maybe on Perfect. other X X I'll jump and or Okay.

expectation? I expected in the think for revenues to really second quarter's the obviously, got the Micron. quarter the I Is that that you after sense quarter still be after year, first the strong call a with bottom last

Robert Andersen

the be we we of I at as roughly look Well, now, would the equivalent. remaining to say that the year quarters expect year

just this the the up we for deals on for line So year full forecast depends the year. that how

I'd remainder year. So equivalent fairly the say, of the for

Richard Shannon

Okay.

Okay. That helpful. is

Maybe here. topic hybrid one one bonding. see scanning for Jon just the of last on Let's list here my

part is, of portion and suppliers quarter, seeing of guess -- mentioned Micron, would that of of NAND question so licensing NAND higher XX% last the And license, DRAM after or far. the a XX% market? expectation think visibility of think the you signing my you more I I there is I any

Jon Kirchner

fair active as across it's pipeline have space the very memory say logic and places. think in to the of we rest in well other that some a would as I

is for I only important about to successful think next is decade. that we of long-term have ever more of going deepest some deploy how It's the the the environment. manufacturing broader trend think a chips. the I And industry's to, use knowledge in think continue value some proposition foundational to IP, hybrid this powerful to of a continue not we but bonding

overall, will time, So I good that say continue we percentages the making we're and those progress, increase would within to believe over broader memory space.

Richard Shannon

Okay. Fair enough.

that's all guys. for think I me

Robert Andersen

Thanks, Richard.

Operator

this Ladies presenters or this I'd additional and gentlemen, remarks. the concludes turn session. to today's back any to time, like At question-and-answer conference for your closing

Jon Kirchner

look Thanks, to today's operator, start months. concludes had you, coming for Both and updated thanks, This everyone progress on a have XXXX, we call. today's Thank call. our you good to operator. and in keeping joining businesses forward the

Operator

and this your gentlemen, We conclude Thank today's you. does Ladies appreciate conference. participation.

You may now disconnect.

Xperi Holding 10 May 222022 Q1 Earnings call transcript