Video technology company DivX has settled its litigation with Yahoo surrounding their two-year license and distribution agreement, and raised its outlook for the third quarter of 2009.
DivX noted that the litigation settlement will increase its operating income in the third quarter of 2009 by around $0.29 per diluted share or around $0.17 per diluted share, net of related taxes.
DivX said that it expects earnings to be in the range of $0.10 to $0.12 per diluted share, compared with its previous outlook of $0.6 to $0.8 loss per share. It expects revenue to be in the range of $15m to $16m.
In November 2008, DivX filed a lawsuit against Yahoo, accusing it going back on agreement announced in September 2007. The companies entered into global agreement in September 2007, to offer consumers who download DivX video software tools a co-branded version of the Yahoo Toolbar and Internet Explorer 7 optimised for Yahoo.
DivX did not disclose the amount for the settlement. Dan Halvorson, executive vice president and chief financial officer, said that the company is pleased to have resolved the dispute with Yahoo.
