InterDigital Raises Outlook as Recurring Revenue Hits Record
Second-quarter revenue reached $260.2 million, rising 27% from the first quarter.
InterDigital Inc. (IDCC) raised its full-year outlook after the technology research and licensing company posted record annualized recurring revenue and added a new streaming and cloud-services program.
Annualized recurring revenue climbed 13% from a year earlier and 10% sequentially to $625.7 million, exceeding the previous record of $588.0 million set in the third quarter of 2024. The increase marked an acceleration in the company’s recurring licensing base even as volatile catch-up payments kept total revenue below the year-earlier level.
Second-quarter revenue fell 13% from $300.6 million a year earlier, while diluted earnings declined 36% to $3.40 a share. Compared with the first quarter, revenue rose from $205.4 million and diluted earnings increased 59% from $2.14 a share as net income climbed to $116.4 million.
Catch-up revenue rebounded 63% sequentially to $103.7 million, helping lift total revenue from the first quarter. It remained 36% below the year-earlier period, and that decline outweighed the growth in annualized recurring revenue.
Streaming and Cloud Services contributed $110.0 million in its first reported quarter, driven by InterDigital’s first agreement under the program with Amazon. Smartphone revenue was nearly unchanged sequentially at $122.7 million, while revenue from consumer electronics, internet-of-things and automotive licensing fell 66% to $27.5 million.
Adjusted EBITDA rose 65% sequentially to $184.1 million, and its margin expanded 17 percentage points to 71%. Operating expenses eased 2% from the first quarter to $120.9 million, though they remained 27% above a year earlier, mainly because of intellectual-property enforcement costs and success-driven share-based compensation.
InterDigital now expects full-year revenue of $775 million to $845 million, lifting the midpoint by $85 million from its previous range. It projects adjusted EBITDA of $469 million to $529 million and diluted earnings of $7.91 to $9.67 a share, both above its earlier forecasts.
For the third quarter, the company expects revenue of $154 million to $158 million, adjusted EBITDA of $86 million to $92 million and diluted earnings of $1.25 to $1.42 a share. The forecast points to a step down from the second quarter as the contribution from catch-up revenue and the new streaming agreement moderates.