InterDigital Announces Financial Results for First Quarter 2025

Core Insights - InterDigital, Inc. reported strong financial results for Q1 2025, with revenues and adjusted EBITDA exceeding the top end of guidance, and an all-time record annualized recurring revenue, up 30% year-over-year [1][4][9] Financial Performance - Revenues for Q1 2025 were $210.5 million, a decrease of 20% compared to $263.5 million in Q1 2024 [4] - Operating expenses significantly reduced to $78.7 million, down 51% from $159.8 million in the previous year [4] - Net income increased by 42% to $115.6 million, resulting in a net income margin of 55%, up from 31% [4] - Diluted EPS rose by 20% to $3.45, compared to $2.88 in Q1 2024 [4] - Adjusted EBITDA was $159.1 million, reflecting a 22% increase from $130.4 million in the prior year, with an adjusted EBITDA margin of 76%, up from 49% [4] Revenue Breakdown - Annualized recurring revenue reached $502.9 million, a 30% increase from $387.5 million in Q1 2024 [4] - Revenue from smartphone licensing surged by 129% to $184.0 million, while revenues from consumer electronics and IoT/Auto dropped by 86% to $26.3 million [4] - Catch-up revenues fell by 49% to $84.8 million, primarily impacting overall revenue [4] Licensing Agreements - The company licensed vivo Mobile, enhancing revenue and achieving a record level of annualized recurring revenue [3] - InterDigital now holds licensing agreements with seven of the ten largest smartphone vendors, covering nearly 80% of the global smartphone market [3] - A new major licensing agreement with HP was signed in Q2 2025, contributing to a cumulative total contract value exceeding $3.6 billion since 2021 [3] Capital Return to Shareholders - In Q1 2025, the company repurchased shares valued at $5.2 million and declared dividends totaling $15.6 million, resulting in a total return of capital of $20.8 million [5] Outlook - The company reaffirmed its full-year 2025 guidance, projecting revenues between $660 million and $760 million, with adjusted EBITDA between $400 million and $495 million [9][10] - For Q2 2025, revenue is expected to be between $165 million and $170 million, with diluted EPS projected between $1.90 and $2.11 [10]