Shares of TiVo Inc. plummeted Friday after the set-top box maker announced a settlement with Google's Motorola Mobility unit, Cisco and Time Warner Cable for less than expected.
TiVo said Friday it reached a settlement with the three companies for a total of $490 million.
That's significantly less than the billions of dollars it originally sought in a lawsuit over its digital video recording equipment and also less than what some reports Thursday suggested TiVo would get.
TiVo sued Motorola last year for patent infringement over its digital video recording technology. Motorola previously hit TiVo with a lawsuit over its DVR technology in 2011.
"We are pleased to reach an agreement that brings our pending litigation to an end and further underscores the significant value our distribution partners derive from TiVo's technological innovations and our shareholders derive from our investments in protecting TiVo's intellectual property," said Tom Rogers, TiVo's chief executive officer, in a statement.
A Motorola spokesman, on Thursday, said, "We're pleased that all parties involved have reached an agreement to resolve pending litigation."
The shares fell more than 17% in mid-session trading Friday to $11.35, wiping out gains Thursday of more than 8% that occured after Bloomberg News reported TiVo and Motorola had settled the patent dispute.
So far, TiVo has reaped about $1.6 billion total from intellectual property disputes, the company said.
The company also said it will use the additional cash for a $200-million stock repurchasing program.
"We intend to use our significant capital resources to drive shareholder value, including more aggressively returning capital to shareholders under our newly increased share repurchase authorization," Rogers said.
Google bought Motorola in May 2012 for $12.5 billion.
Twitter: @rfaughnderCopyright © 2015, CT Now