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Xperi Releases First Financial Report Since Company Split

The HD Radio developer said the connected car accounted for 17% of total revenue in Q4 2022

In its first quarter as an independent company Xperi posted revenue of $135.5 million in Q4 2022. That compares to $125 million for the same period a year ago.

However, Xperi still reported a loss of $297 million in the fourth quarter ending Dec. 31, 2022. That’s a loss of $7.06 per share.

Officials with the media software company, which is the parent to brands like HD Radio, TiVo and DTS AutoStage and AutoSense, said they remain optimistic the newly independent Xperi is positioned for growth in its connected car business, namely in-vehicle infotainment and in-cabin monitoring.

“Our first quarter as an independent company was underscored by substantial market progress, notable design wins, and strong financial performance,” said Jon Kirchner, chief executive officer of Xperi. “Consumers are demanding higher quality digital experiences and our customers and partners are increasingly selecting our independent media platforms to meet that demand. We are intensely focused on expanding our platform adoption and our recent design wins in Smart TV and Connected Car are a testament to the ongoing success of our growth strategy.”

The connected car accounted for 17% of total revenue in Q4 2022, up 4% YoY. Xperi said this is primarily due to the progress made in AutoStage and AutoSense, in addition to automotive head unit production that includes its audio solutions.

[Related: “FCC Sifts Through Comments on Request to Boost FM Digital Power“]

Meanwhile, the pay TV business (TiVo) represented approximately half of Xperi’s total revenue in the final quarter of 2022, according to the company’s filing with the Securities and Exchange Commission. 

Looking at 2022 as a whole, the company reported a loss of $757.5 million, or $18.02 a share. Overall, it reported an annual revenue of $502.3 million, which was up 3% compared to $486.5 million in 2021.

Connected car revenue in 2022 declined 5% YoY, Xperi says, primarily due to lower automobile production volumes that impacted its HD Radio revenue.

Kirchner on an earnings conference call Tuesday specifically pointed to DTS AutoStage infotainment and DTS AutoSense solutions as growing opportunities.

“The automotive industry is making extensive investments in connected car as Internet connectivity is turning the cabin into a personal entertainment space. We have longstanding relationships with automotive manufacturers who have adopted our HD Radio solution deployed in over 95 million vehicles,” Kirchner told investors. “And now we are leveraging our media platform solutions incorporating metadata, our legendary search and discovery and TiVo’s video capabilities to provide a vastly improved in-cabin entertainment experience.”. 

Kirchner says the company’s AutoStage platform continues to expand under a broader auto manufacturer umbrella: “So these deals commonly involve engineering that has front end time, but then they begin to roll usually on some models. We are doing fantastically well at winning business. One of the things the world can’t fully see yet is how that business will ramp over the next three, five, seven years.”

[Related: “Garmin Cabin Demo Features DTS AutoStage“]

The company’s AutoStage and AutoSense platforms continue to win new contracts for future model years, he said, and Xperi expects “accelerating revenue growth as these contracts go into production.” 

In addition, Xperi plans to incorporate ad monetization into the AutoStage platform, Kirchner says, which will create another opportunity for revenue growth further downstream.

The San Jose, California-based company during the fourth quarter was awarded its first design win incorporating video into the AutoStage in-car infotainment platform. 

“This offering, which goes into production later this year, will bring TiVo’s video platform into the center console. Also in connected car, we continue to be awarded design wins for AutoSense, our in-car driver and occupant monitoring systems, most recently winning a major program with a large Asian automotive OEM,” Kirchner said during the investor call.

Xperi says it is focused on four key areas overall: connected TV advertising, IPTV [Internet Protocol Television], in-vehicle infotainment and in-cabin monitoring. “We expect these four key growth areas to represent over 40% of our total revenue in three years,” Kirchner said.

Xperi CFO Robert Anderson told the analyst call the company’s 2023 financial outlook is for revenue growth: “We expect full year revenue to be in the range of $510 million to $540 million. We expect this growth to come primarily from our media platform and connected car businesses.”

Xperi Inc. last fall separated from Xperi Holding Corp., now known as Adeia Inc., which mostly operates as an intellectual property licensing company. 

The newly independent Xperi Inc. trades on the New York Stock Exchange under the symbol XPER.