Xperi at Midwest Ideas: Strategic Growth in Media Platforms

On Wednesday, 27 August 2025, Xperi Inc. (NYSE:XPER) participated in the 16th Annual Midwest Ideas Conference, presenting a strategic overview that highlighted both opportunities and challenges. The company emphasized its position in the media platform space, focusing on growth through the TiVo One ad platform and connected car solutions. Despite a slight revenue decrease due to timing issues, Xperi remains optimistic about its long-term growth prospects.

Key Takeaways

• Xperi is focusing on four key markets: Pay TV, Consumer Electronics, Connected Car, and Media Platform.
• The TiVo One ad platform aims to reach 5 million monthly active users and a $10 ARPU.
• Operating expenses have decreased significantly due to cost transformation efforts.
• Revenue guidance for the year has been revised to $440 million to $460 million.
• The company maintains a strong cash position with $95 million in cash and cash equivalents.

Financial Results

Xperi reported a slight year-over-year revenue decrease, mainly due to the timing of minimum guarantee arrangements, which account for about 20% of annual revenue. Operating expenses were reduced by $18.7 million due to cost transformation and compensation reversals, leading to a slight increase in adjusted EBITDA. The company generated $10 million in cash during the quarter, with $5 million in free cash flow. Full-year revenue is now expected to be between $440 million and $460 million, with an adjusted EBITDA margin target of 15% to 17%.

Operational Updates

• TiVo One Ad Platform: Expanded to nine partners, reaching 3.7 million monthly active users. The platform targets 5 million users and a $10 ARPU by the end of 2025.
• Connected Car: Signed two new AutoStage OEM programs, expanding HD Radio’s presence to over 110 million vehicles. Approximately 80 new broadcasters joined the AutoStage ecosystem.
• Pay TV: IPTV subscriber growth exceeded 30% in North and Latin America, with 3 million subscribers by mid-summer. Multi-year renewals were signed with Liberty Latin America and Cable One.
• Consumer Electronics: Renewed contracts with major customers like TPV, TCL, and Sony for DTS sound technology. Signed the first customer for Clear Dialogue, an AI-based dialogue enhancement technology.

Future Outlook

• Xperi aims to have 10 TV partners by the end of 2025 for its media platform.
• The company is focusing on increasing IPTV subscribers to counter declines in traditional pay TV.
• Clear Dialogue technology is expected to launch in the first half of next year.

For a more detailed account, readers are encouraged to refer to the full transcript below.

Full transcript - 16th Annual Midwest Ideas Conference:

Erke Ergen, Assistant Account Manager, Three Part: Alrighty. Are you guys ready go? Alright. Good morning. Welcome to the sixteenth annual ideas conference.

My name is Erke Ergen, assistant account manager here at three part. Today, have Experian traded on the New York Stock Exchange, ticker x p e r. Today on the team, we have Robert Anderson, CFO, and Joc Krinchner, CEO. Gentlemen.

Joc Krinchner, CEO, Xperi: Thank you and good good morning. Pleased to be here today to talk with you about Xperi. As we begin, just to encourage you to take note of our safe harbor statement. So Xperi invents and develops technologies and solutions that enable extraordinary experiences. What does that mean?

Basically means we’re a technology and solutions provider to markets like connected car, pay TV, consumer electronics and as we’ll talk about meaningfully have entered the media platform space where we are in the business of working to monetize content consumption. And I think one of the notable things about us is we don’t go to market under the Xperi name, it’s holding company name, but we go to market under the brands we own, which include TiVo, DTS, HD Radio and through a partnership with IMAX, IMAX Enhanced. We basically service four markets, and this is the way our business is organized. First, Pay TV, so if you’re old enough, you’ll remember TiVo from the days of old, we invented the digital video recorder for time shifting. But then over time TiVo became a big provider of software and services to the various cable operators and became more of a solutions provider to them where we provide interactive programming guides, video over broadband solutions, personalized content discovery and recommendations, etcetera.

And the primary business model in that space is largely subscriber fees from our cable operator customers around the world, primarily North America and Latin America. We then have a consumer electronics business, which is largely about audio licensing. So DTS is one of the two large audio licensors in the world and we license our codex and post processing solutions across the CE space that’s in your living room, in your car, on mobile devices, on PCs, etcetera, as well as into things like gaming related accessories. We also in that space license the IMAX Enhanced brand for home and mobile devices and the core revenue model here is per unit licensing fees for the embedding of the solution. Then we have our connected car business, which is all about in cabin entertainment where we license HD Radio, which is the sole digital terrestrial radio standard in North America.

So what does that mean? It means we basically if you want digital radio, know, you know, standard broadcast delivery not through satellite, but actually, you know, free in your car digital radio, it’s gonna be it’s gonna be HD radio for which we get license fees on a per car basis. And related to that, we have recently developed a product called AutoStage, which is next generation infotainment for both audio and music as well as video, where we are building a footprint to drive a monetization play over time related to advanced advertising and targeting in the vehicle. We also licensed music metadata, we’re one of the largest music metadata holders in this space and we provide other sound enhancement solutions for the cabin. And then finally, media platform which is where you’ll find TiVo again, we have developed a smart TV operating system called TiVo OS that effectively manages your content aggregation search and discovery on the screen.

So if you think about it, a modern smart TV screen today where you have tiles across, you know, based on what’s trending, genres, etcetera. We have built that interface largely because embedded in that interface are sponsored ad opportunities where you can you can ultimately monetize you know, traffic to and from the homepage or on so called fast free ad supported streaming applications. And we’ll talk about this in more detail, but it’s an area of our business that we think has the greatest potential to grow meaningfully as we’ve done a lot of core groundwork over the past couple of years to put this play in motion. We also in connection with this provide a related media platform solution for IPTV or video over broadband devices that connect to television. So there’s a there’s a common element there and that it’s a it all relates to to the TV.

From a customer perspective, notably our business is quite diverse. We have four different markets we’re serving. There are some underlying technology threads that tie all this together, but we basically have a tremendous customer list. We’ve been at this business in different ways for decades. So deep channel relationships, deep customer relationships, I think a trusted partner and innovator with brands across the entire space.

When we don’t think about our business based on the four core areas, but rather think about what we’re doing within those areas, we tend to think about the business in two different ways. One is where we have growth solutions, what do we expect to meaningfully grow over time and what are core solutions, think businesses or technologies we’ve been in for a long time that are well established and ultimately you know generating higher you know higher margins that in part are fueling the and supporting investment in the growth solutions. And media platform, know, the TiVo One ad platform that I was I was talking about just a second ago, which is all about monetization is the area we think drives the most growth. We also in the TV space license core middleware that helps the TV do certain things and that’s been a long standing licensing program through our viewed platform. In connected car, DTS AutoStage is the newer product, it’s got the greatest growth potential and we also believe from a continuation kind of a core business perspective HD Radio and Music Metadata will continue to be licensed successfully.

Pay TV, video over broadband or IPTV is the one area of pay TV that’s growing even though the business more broadly is in secular decline as people are cord cutting. And we are working to have that IPTV growth kind of offset the decline in the traditional business as you see core solutions like search and discovery, classic guides and consumer hardware and subs reflect a downward trend. And then finally and more broadly in consumer electronics, I would say most of that business at this point is largely core as you think about licensing DTS technologies or IMAX Enhanced or broader audio things where we kind of move with the market time. So if I go to specifically the TiVo One ad platform where I think we have the greatest excitement over the prospects for growth. What is it?

It is a platform that basically connects smart TVs and set top boxes powered by TiVo where we’re doing the content aggregation and whatnot into a cross screen ad platform that can monetize consumer engagement with the device. So what do we mean by that? You’re watching TV, you’re flipping around through channels or apps or content in the course of that process, we’re able to expose you to ads and encourage you to you know, select services or content that you know, not only meet your own personal interest from a search and rec recommendation perspective, but things that ultimately can drive monetization dollars. So if you look at this top screen on the right, you notice there’s a shark week photo in the back of all these tiles, that’s an ad unit, that’s what they call a homepage ad unit and somebody’s paying for that to be there. Similarly, of the tiles that exist within the interface or when you click on a tile and you ultimately start to run a program, there may be a short ad or there might be an ad based when you pause or or when a program completes.

All of those are opportunities to to monetize that engagement. And whether it’s smart TV, smart TVs that are incorporating our TiVo OS or it’s set top boxes that are using our IPTV solution that are connected into the same TiVo One ad platform, we are seeing tremendous market interest in what we’re doing and the reason that we’re winning, we think business and really beginning to establish this footprint more meaningfully is that we’ve got a best in class TV operating system and interface. We’ve been doing this for a very long time, decades. We are independent in the sense that we provide a solution, but we don’t make TVs to compete with our customers. And many of the other solutions you’ll find out there in the smart TV space and the TV OS space are really provided by people who in turn sell TVs and go head to head with the very people now that they’re trying to license solutions to, which obviously doesn’t bode well for the people that have to take those solutions.

So they’re looking for options. We’re willing to share advertising revenue. So it’s a rev share model as well as data with our customers. They get to continue to brand the TVs. We are co branding them.

We’re not trying to take over the branding of what the TV is called. And we offer a lower cost actual hardware solution that is truly globally scalable. And the outcome of this both business model and technical solution has taken us two and a half years ago from having no customers to we’ve now got nine TiVo OS partners, 3,700,000 monthly active users on the platform, we’re shipping TVs in more than 40 countries, 80 brands and across 30 major retailers. Within that, roughly 40% of that 3,700,000 is based in The United States, largely through set top boxes at this point. But you’ll see we’re seeing TVs come online here in The U.

S. And the balance of it is in Europe where we really focused our initial efforts to establish the platform. And I think relative to the goals that we set were build footprint and then start to turn on the monetization crank if you will and work to optimize that. Our goal was to get to 10 TV partners by the 2025 with nine we’re pretty confident we will get there with one more at least by the end of the year. We’ve set goal a goal around 5,000,000 monthly active users on the platform.

We’re now at 3.7. A quarter ago, we were at 2.5. So we feel pretty good that we’ll hit that 5,000,000 goal. And we’re working toward, as I said, turn on the monetization efforts to and targeting a $10 exit rate ARPU. So what does that mean?

It means that as you look on those 5,000,000 units moving forward coming out of the year that we can generate at least $10 of advertising revenue on an average per those units. So making a lot of progress and I think setting the foundation for what should translate to very meaningful growth over time. Few other, I think key highlights as I now move back through the rest of the business from a connected car perspective, we signed two new auto stage OEM programs with 12,000,000 vehicles out there. We’re seeing broad based support for the program. And to give you a frame of reference, HD Radio, is obviously our first product into the automotive space of its kind, today is in more than 110,000,000 vehicles.

So we’ve got a lot of experience in building car based infotainment ecosystems. We have also importantly broadened ecosystem for auto stage with broadcasters cause it’s not just about having a technology stack in the car to receive, you’ve got to have people broadcasting supporting the format. And we’ve been very very good about adding broadcasters, wanna say during the quarter, think we added about 80 new broadcasters and we’re in countries all over the world that people supporting this to varying degrees. And we signed some new IC contracts which enable car companies to have more choice in the chips that they use to implement HD Radio. In Pay TV, we saw IPTV subscriber growth.

I talked about IPTV as the growing part of Pay TV of over 30% across North America and LatAm. We signed some large multi year renewals in the quarter with operators, large operators including Liberty Latin America and Cable One. We set a goal for the year of 3,000,000 IPTV subscribers by the end of the year. We’ve already hit that as we sit here in mid summer for IPTV and we’ve also seen continued uptake on our metadata agreements with people like Proximus. In the CE side, we continue to, I think prove quarter over quarter the relevance of DTS sound technology signed contract renewals with key customers TPV, which owns the Philips brand among other things, TCL and Sony doing similarly similar renewals with IMAX Enhanced, an agreement with Sony that covers a bunch of different product categories and we signed our first customer for a product that we’ve worked on for a couple of years called Clear Dialogue, which is AI based dialogue enhancement technology and the simplest way to understand is that when you do polls on people’s feedback about watching TV, more than 40% complain that they can’t hear the dialogue.

And that has partially to do with production techniques, has to do with the fact that you have widely varying presentation in whatever room you’re in, as well as varying devices, and the quality and of course you have different people. We all have different hearing profiles. And ClearDialogue is the first kind of end technology and product solution, meaning it’s embedded on the TV, it’s not trying to manipulate the content before it gets to the TV, where you can actually isolate and have independent control of the dialogue. So, you know, rather than turn on the subtitles as a solution at night with, you know, my wife and I debating as to whether I want them on and she doesn’t or vice versa, you can independently imagine you have a, you know, you have your plus minus button on your remote, imagine that you can plus minus how much dialogue you wanna hear, radically changes the I think the listening experience and one that we’re super excited about comes to market in the first half of next year. And it’s all based on AI technology and some work we’ve done in over the last couple of years.

Super, super enthusiastic about the potential impact of that product. So as we exit the year, just to reframe, we’ve got these exit goals, in media platform, Pay TV and Connected Car. I think we’re well on our way to achieving what we’ve set out at the beginning of the year. And we’re obviously gonna continue to drive as much progress as we can up and through the goals that we set. So I think despite all of the turbulence which we’re seeing plenty and kind of core businesses around the broader macro environment, tariffs, uncertainty, etcetera.

Strategically, the things we’re trying to do to build the business over the long term are going very, very well. So with that, let me turn it over to Robert to walk you through some financial details. Robert?

Robert Anderson, CFO, Xperi: Okay, thanks John. So I’ll just give a quick overview on from a financial perspective. And what I’m showing here is just our Q3 year over year revenue. I do over on the right exclude a divestiture we made in September which is Perceive. So you can see that that was actually embedded in the consumer electronics category.

As I go through kind of any given quarter, I’m often describing, okay, this is a minimum guarantee that occurred last year or this is something that we did this year. Let me just pull back for one second and explain what we do from a business perspective in terms of signing longer term agreements with our customers. We enter into minimum guarantee arrangements with our customers quite often in consumer electronics, but also sometimes in pay TV and connected car. They tend to be about three years long. And what we get is certainty that our technology is going to be used by that customer over the period of time.

And what we get in return from the customer in for making this a longer term agreement is a minimum amount that they’re going to use for per unit or number of subscribers within pay TV. So we get a lot in terms of doing that. From an accounting perspective, often we’ve already delivered the technology that goes on a chip. And so we don’t we could take the revenue, we have to actually take the revenue upfront. And for that creates a little bit of spike in the revenue in given quarter.

So often when I’m comparing say something to last year within, we’ll take an example here within connected car, we had done a minimum guarantee arrangement with a customer last year that tends that we’re not repeating this year. From a broader perspective about 20% of our revenue in a given year is under minimum guarantees. So it makes the overall year over year on a quarter basis comparisons pretty tricky. And that’s an effect what’s going on within these descriptions. If we look at just kind of an overall financial summary, again, we’re comparing year over year for Q2 which is the last quarter that we announced.

We’re down a little bit on the revenue, again that’s driven by minimum guarantees that were done last year. But from an operating expense perspective, we’re down quite a bit. A few things going on there. We’ve been working on cost transformation since we did the separation back in 2022. And we’re starting to really continue to get the benefits from that cost transformation and just genuine focus.

We also have some reversals of variable comp that occurred in Q2. So that kind of combination you see the $18,700,000 down on operating expense on an adjusted basis, right, the non GAAP numbers year over year. All that our primary measure for profitability is adjusted EBITDA. It was actually up slightly year over year. So in spite of the decline in the revenue, we were able to balance out with expense.

And we’re pretty close in terms of earnings per share year over year. When we look at the balance sheet, we have at the end of Q2, 95,000,000 of cash and cash equivalents. We generated cash in quarter of $10,000,000 and $5,000,000 of free cash flow. We’ve indicated for the year, and I’ll get to this in a second, when we look at the overall view for the year that we would expect to be probably cash flow neutral. We tend to burn cash in Q1 and then generate cash in the remaining quarters.

That’s just the cycle for our cash. So we have this is a key focus for us as a company to make sure that we’re cash flow positive ideally this year and certainly going forward. And I think we’d certainly have enough cash to get by from a operating perspective. I don’t see any of that or what we would need to do any type of financing. And as we look at the outlook for the year, we have set the revenue goal of $440,000,000 to $460,000,000 That’s we brought that down just before we did the Q4 excuse me, Q2 announcement.

And we’ve set the adjusted EBITDA margin target at 15 to 17%, down just slightly we previously were at 16% to 18 So we’ve definitely had an impact on the top line and then on the margin basis from tariffs and some of the macroeconomic items that were impacting most companies. So we definitely recast for the year, but we feel confident in these numbers. The only thing we changed was just noting that the operating cash should be neutral plus or minus 10 as opposed to calling it slightly positive. The rest of the stuff stayed the same. So that’s a quick overview on the financial basis.

Let me return it back over to John for closing remarks and questions. Great.

Joc Krinchner, CEO, Xperi: Obviously a very quick overview for somebody that may be less familiar with the business but happy to take any questions that anybody may have. Okay. So, know, I think think the key takeaways that we’d very much encourage you to consider is that media consumption only continues to go up. There are more people consuming more entertainment on more devices and more environments than ever. And there is tremendous value footprint that connects to that consumption and ultimately tremendous value connected to your ability to help advertisers reach their audiences in more effective ways.

And, you know, as we think about our business as being, you know, it’s technology centric whether it’s audio or it’s video and you think about the different spaces in which we play which is in your living room and in your car ultimately on other mobile devices and our ability to not only license technology into those devices but ultimately build a broader platform that allows us to align that platform with what people are doing I. E. Engaging with content, we think there’s a tremendous opportunity to drive a lot of growth. Ecosystems are not only non linear but they can take a while to build, but we feel like we have a very clear path towards some durable competitive positioning that builds on decades of domain expertise and channel relationships in many of these spaces. It ultimately drives home a not only a model but a business that can be not only growing quite substantially and attractively but ultimately quite profitable and very cash flow generative.

So appreciate your time today. Thank you for you know, thank you for your attention. And to the extent you have any questions, please reach out. Thank you.

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