DivX and Yahoo have reached a mutually agreeable settlement with respect to the parties' litigation surrounding their two-year License and Distribution Agreement entered into by the two companies in September 2007.

"We are pleased to have this matter resolved," stated Dan Halvorson, Executive Vice President and Chief Financial Officer. "The litigation settlement will increase our operating income in the third quarter of 2009. As a result, we have upwardly revised our GAAP earnings guidance for the third quarter by $0.29 per diluted share, or $0.17 per diluted share net of related taxes, and now expect GAAP earnings to be in the range of $0.10 to $0.12 per diluted share. This settlement will be recorded as a separate line item in our income statement under Operating Expenses."