For the quarter ended June 30, 2001, OpenTV’s revenues were $22.8 million compared to $11.3 million for the quarter ended June 30, 2000. Second quarter 2000 results exclude the impact of OpenTV’s acquisition of Spyglass, which closed on July 24, 2000.

The Company’s pro-forma operating expenses for the quarter ended June 30, 2001 totaled $29.5 million compared to $17.2 million for the quarter ended June 30, 2000.

OpenTV’s pro-forma net loss was $4.1 million, or $0.06 per share, for the quarter ended June 30, 2001 compared to a pro-forma net loss of $3.3 million, or $0.07 per share, for the quarter ended June 30, 2000. On a reported basis, the Company’s net loss for the quarter ended June 30, 2001 was $120.2 million, or $1.82 per share, compared to a reported net loss of $7.8 million, or $0.17 per share, for the quarter ended June 30, 2000. Included in the second quarter 2001 reported net loss was $106.0 million of non-cash operating expenses related to the amortization of: goodwill, other acquisition-related intangible assets, and share-based compensation.

As of June 30, 2001, OpenTV had cash, cash equivalents and marketable debt securities of $217.1 million.

I am pleased to announce another successful quarter for our Company, said OpenTV CEO James Ackerman. Our core platform line of business delivered another profitable quarter, signed three new network operator customers and reported more than two million set-top box deployments. Our OpenTVi line of business more than doubled its revenue versus last quarter and delivered a comprehensive suite of iTV applications that are currently available in Half Moon Bay, California on the Motorola DCT-2000. To further position the Company for future growth, we announced our acquisition of Static, a leading iTV media and entertainment applications company whose operations include PlayJam, the most widely-distributed iTV games channel in the world.

Mr. Ackerman continued, I firmly believe this quarter demonstrates our continued success in growing our market-leading core platform business, as well as our ability to move up the iTV value chain through the expansion of our iTV applications business.

Starting with its first quarter 2001 results, OpenTV began providing financial results separately for its two major lines of business: core platform and OpenTVi.

For the quarter ended June 30, 2001, OpenTV’s core platform business generated revenues totaling $20.6 million and pro-forma operating profit of $1.8 million. These results reflect both the strong deployment of OpenTV solutions and the continued growth in OpenTV’s professional services organization. Highlights for the quarter included:

In May, OpenTV extended its market leadership position in iTV platform deployments, announcing that its middleware solution was deployed in 2.1 million additional set-top boxes during the quarter ended March 31, 2001. Through March 2001, 16.0 million OpenTV-enabled set-top boxes have been shipped to network operators throughout the world.

During the quarter, OpenTV increased its global, market-leading network operator customer base to 44, adding one broadband cable network and two satellite networks. OpenTV signed an agreement with Shanghai Cable – the largest cable TV network in China with 3.2 million total subscribers and 1.0 million digital cable subscribers – to provide core platform products, professional services and applications. Shanghai Cable is OpenTV’s 14th cable network operator customer win. OpenTV also signed an agreement with satellite network operator Philippine Multi-Media System Inc. (PMSI) and, today, announces it has signed an agreement with South African satellite network operator Sentech. OpenTV is providing its core platform products to both PMSI and Sentech.

During the quarter, OpenTV expanded its partnerships with digital TV set-top box manufacturers. OpenTV’s set-top box manufacturer partner base now totals 33, as Quanta Network Systems of Taiwan announced it intends to port OpenTV’s middleware to its digital set-top box platforms. OpenTV also announced extended partnerships with Pace Micro Technology and Philips Semiconductor. Pace intends to port OpenTV to its advanced Di4000 cable home gateway, and Philips intends to port OpenTV to its Nexperia Home Entertainment Engine line.

For the quarter ended June 30, 2001, OpenTVi generated applications-related revenues of $2.2 million, an increase of 107% from the prior quarter. Applications-related revenues include application license revenue, revenue-sharing agreements and professional services revenue related to application development, customization and integration for network operator customers. OpenTVi’s pro-forma operating loss for the quarter ended June 30, 2001 was $8.5 million, reflecting OpenTV’s significant investment in growing its application business. Highlights for the quarter included:

On June 23, OpenTV announced that it would acquire London-based Static, a privately-held leading iTV media and entertainment applications company. Static provides multiple-platform iTV application development expertise, broadcast design services for TV networks, and owns and operates the world’s most widely-distributed iTV entertainment and games channel, PlayJam. Network operators carrying PlayJam include BSkyB, TPS, Canal Satellite, ntl, and Telewest. The acquisition closed on July 2.

This week, OpenTV announced that it has successfully launched a comprehensive suite of two-way interactive TV applications on USA Media Group’s Half Moon Bay, California network. Twenty-nine iTV applications – including commerce, email, instant messaging, interactive games, on-demand news and information, and enhanced TV – are available on the DCT-2000 set-top box, which is the most widely-deployed digital TV set-top box in the U.S. cable industry. The applications utilize the network’s existing back-channel infrastructure while delivering rich, two-way interactivity, and many of these applications leverage Internet-based content in delivering a TV-centric interactive experience.

SOURCE: COMPANY PRESS RELEASE