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TiVo boosts revenue target

The company, which makes digital video recorders, doubles its previous revenue target for its second quarter, courtesy of a recent licensing pact.

TiVo doubled on Wednesday the revenue targets for its second quarter, courtesy of a recent licensing pact.

TiVo, maintains a service for digital video recorders, said it expects total revenue for its second quarter to be between $23 million and $24 million, compared with its previous projection of $10.5 million to $12 million.

A consensus of Wall Street analysts forecast the company's revenue at $11.2 million for the quarter ending July 31, according to a survey by First Call. Analysts expect TiVo to lose 40 cents a share when it reports Aug. 22.

In early trading, TiVo shares were up 67 cents, or 26 percent, to $3.26. Shares of TiVo have traded as low as $2.25 and as high as $7.80 this year.

The company cited an additional $12 million in revenue from licensing and professional services as the reason for its new outlook. TiVo did not cite specific deals, but in October of last year the company signed a licensing deal with Sony Electronics for around $10 million. During recent earnings calls, TiVo executives have said that the company had not realized the revenue from the Sony licensing agreement.

TiVo executives have said in the past that the company is putting more focus on its licensing business and in June signed Toshiba to a licensing deal. TiVo spokeswoman Rebecca Baer said the company expects revenue to come in at $50 million to $60 million and 20 percent, or about $10 million to $12 million, would come from licensing contracts.

Analysts continue to see hurdles to the popularity of DVRs.

"In our view, DVRs will only become mass-market products when bundled into other consumer electronic devices," Marla Backer, a Brean Murray analyst, wrote last week in a research note that commented on TiVo's licensing strategy.

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"That is why we believe that TiVo's evolution to a licensing/software model from a hardware model should accelerate consumer adoption of TiVo."

Last week, TiVo announced a plan to expand its regional and national distribution network, adding two additional major electronic store chains as retailers.

Signs of TiVo's growing popularity--and nascent clout--are becoming more apparent. Nielsen Media Research, the TV audience measurement company, is working with TiVo to begin tracking viewer information from TiVo's DVRs.