Macrovision's Revenue Slides

SAN FRANCISCO - Recently merged with Gemstar-TV Guide, Macrovision's(MVSND Quote) first-quarter revenue fell sharply Wednesday.

Now known officially as Macrovision Solutions, the Santa Clara, Calif., software company reported revenue from continuing operations of $32.2 million, down 12% from $36.6 million for the same quarter of last year. Analysts polled by Thomson Financial were expecting a top line of $42.5 million.

The revenue shortfall from continuing operations was greatest in its entertainment business, which dropped 35%, to $9.3 million. Macrovision sells digital distribution and copy-protection software to entertainment companies.

Net income was $6.3 million, or 12 cents a share, vs. $5.7 million, or 11 cents a share, in the year-ago period.

Excluding special items, EPS was 14 cents. Analysts were looking for 30 cents.

The results don't include revenue from Gemstar-TV Guide, a deal that closed May 2. On a combined basis, but excluding recently sold software and games businesses and Gemstar's publishing business, total revenue since the start of the first quarter was $151.7 million.

Macrovision sold Trymedia in February and a software business in early April.

A restructuring will add costs of $31 million during the remainder of 2008, but will yield savings of about $50 million by the end of the year, the company estimated.

"We have fundamentally transformed Macrovision into a digital media technology leader, now well-positioned to help enable the shift to digital entertainment," CEO Fred Amoroso said in a statement. "We are executing against our integration plan and are exploring strategic alternatives for Gemstar's media assets."