(TiVo earnings article updated with additional information from its third quarter report.)

ALVISO, Calif. ( TheStreet) -- TiVo ( TIVO - Get Report) saw losses widen to $20.6 million in the third quarter as revenue dropped and operating costs spiked.

For the quarter ended October 31, the company reported a loss of $20.6 million, or 18 cents per diluted share, compared with a loss of $6.4 million, or 6 cents per diluted share, in the same period a year ago. Losses were slightly wider than analysts' consensus expectation for a loss of 17 cents a share.

The company's total operating expense was up 32% to $44.2 million from $33.5 million a year earlier and revenue fell 10.9% to $50.9 million from $57.1 million.

TiVo reported a drop in revenue across its three segments. Revenue from its service division decreased 9% to $34.3 million from $37.7 million and technology revenue declined 24.9% to $7 million from $9.4 million. Hardware revenue fell 5% $9.5 million from $10 million.

The total number of cumulative subscriptions dropped 17% to 2.3 million from 2.7 million in 2009.

TiVo's management is looking forward to closing international deals with Virgin Media ( VMED) in the U.K., ONO in Spain and Canal Digital in Scandinavia.

"Outside the U.S., our momentum continues to build as we signed yet another European distribution deal with Canal Digital, the largest satellite operator in Scandinavia and as Virgin is nearing launch of our service," president and CEO Tom Rogers said. "We believe that the work that we are doing and the distribution deals we have in place will become apparent in our financials over time."

Rogers said that the deals with the international outlets will make TiVo available to up to 7 million European households over the next few years.

For the fourth quarter, management expects a net loss between $32 million and $34 million. The company anticipates that the final quarter of 2010 will be impacted by about $10 million in costs due to holiday hardware pricing.

For the nine months ended October 31, the company reported a loss of $50.1 million, or 44 cents per share, compared with a loss of $13.1 million, or 12 cents, in the same period a year ago. Revenue fell 3.5% to $163.8 million from $169.8.

Revenue from its service division decreased 12.5% to $106.2 million from $121.3 million and technology revenue declined 11.6% to $20.4 million from $23.1 million. Its hardware revenue saw a 46.4% increase to $37.2 million from $25.4 million.

Management added that the company remains confident in its ongoing legal battle with EchoStar ( SATS - Get Report) and Dish ( DISH - Get Report) after the United States Patent and Trademark Office reaffirmed the validity and terms of TiVo's patent on its Time Warp software used in its DVRs.

-- Written by Theresa McCabe in Boston.

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