Adeia(US:ADEA)2025-11-06 21:22Revenue Performance - Revenue for the three months ended September 30, 2025, increased by $1.2 million, or 1.4%, to $87.3 million compared to $86.1 million in 2024[135]. - Recurring revenues for the same period increased by $3.6 million, or 4.4%, from $82.7 million in 2024 to $86.3 million in 2025[135]. - Non-recurring revenues decreased by $2.4 million, or 70.6%, from $3.4 million in 2024 to $1.0 million in 2025[135]. - For the nine months ended September 30, 2025, revenue increased by $3.8 million, or 1.5%, to $260.7 million compared to $256.9 million in 2024[135]. - Recurring revenues for the nine months ended September 30, 2025, increased by $6.0 million, or 2.4%, from $249.8 million in 2024 to $255.8 million in 2025[140]. - Non-recurring revenues for the nine months ended September 30, 2025, decreased by $2.1 million, or 29.7%, from $7.0 million in 2024 to $4.9 million in 2025[141]. Operating Expenses - Research and development expenses for the three months ended September 30, 2025, were $16.0 million, an increase of $1.2 million, or 8%, compared to $14.8 million in 2024[143]. - Total operating expenses for the three months ended September 30, 2025, were 69% of revenue, compared to 67% in 2024[136]. - SG&A expenses decreased by $1.98 million (7%) to $24.92 million for the three months ended September 30, 2025, while increasing by $9.93 million (13%) to $85.48 million for the nine months ended September 30, 2025 compared to the same periods in 2024[145][146]. - Amortization expense increased by $0.575 million (4%) to $14.175 million for the three months ended September 30, 2025, but decreased by $14.36 million (25%) to $42.427 million for the nine months ended September 30, 2025 compared to the same periods in 2024[147][148]. - Litigation expenses rose by $2.543 million (96%) to $5.195 million for the three months ended September 30, 2025, and increased by $8.379 million (85%) to $18.223 million for the nine months ended September 30, 2025 compared to the same periods in 2024[149][150]. Income and Cash Flow - Net income for the three months ended September 30, 2025, was 10% of revenue, down from 23% in 2024[136]. - Cash provided by operating activities increased by $3.5 million, or 24.5%, from $14.3 million in 2024 to $17.8 million in 2025[135]. - Net cash provided by operating activities was $98.088 million for the nine months ended September 30, 2025, compared to $105.001 million for the same period in 2024[159]. - Other income and expense, net increased by $1.431 million (3%) to $1.476 million for the three months ended September 30, 2025, and increased by $363,000 (9%) to $4.622 million for the nine months ended September 30, 2025 compared to the same periods in 2024[152]. Cash and Debt Management - Cash and cash equivalents were $56.09 million as of September 30, 2025, down from $78.825 million as of December 31, 2024, while total cash, cash equivalents, and marketable securities increased to $115.074 million from $110.392 million[159]. - Net cash used in investing activities for the nine months ended September 30, 2025, was $34.4 million, primarily due to purchases of short-term investments of $46.3 million[170]. - Net cash used in financing activities for the nine months ended September 30, 2025, was $86.4 million, mainly due to $39.3 million in repayment of indebtedness[174]. - As of September 30, 2025, $447.8 million was outstanding under the term loan B facility, with an interest rate of 7.8%[179]. - Future minimum principal payments for debt include $6.1 million in the remainder of 2025 and $24.4 million each year from 2026 through 2027[180]. - The 2020 Credit Agreement was amended to reduce interest margins from SOFR plus 3.50% to SOFR plus 3.00% per annum[176]. - The company had $9.1 million of unamortized debt discount and issuance costs recorded as a reduction from the carrying amount of the debt[179]. - No excess cash flow payment is required in 2025 based on certain leverage ratios and voluntary prepayments made[180]. Tax and Future Outlook - The effective tax rate for the three months ended September 30, 2025, was 52.1% on pretax income of $18.4 million, while for the nine months ended September 30, 2025, it was 6.5% on pretax income of $40 million[155]. - The company expects that cash from operations will be sufficient to meet anticipated cash requirements for at least the next 12 months[164]. - There were no significant changes in critical accounting policies and estimates during the nine months ended September 30, 2025[181].