InterDigital, Inc.: Q4 FY2025 earnings call

What management said about Q4 FY2025, from the documents filed with the SEC on 5 February 2026: press release. Guidance figures: 22 new. The quarter’s numbers.

Read the filing

Key takeaways

• Full-year revenue down 4%: Full-year revenue was $834.0 million, down 4% from $868.5 million. Management described it as near-record. Source
• Full-year net income and EPS: Full-year net income was $406.6 million, up 13%. GAAP diluted EPS was $11.80, down 2%; non-GAAP EPS was $15.31, up 2%. Source
• ARR up 24% to $582.4 million: Annualized recurring revenue rose 24% to $582.4 million from $468.0 million. ARR is quarterly revenue less catch-up revenue, multiplied by four. Source
• Samsung, vivo, Honor and HP deals: The company said it completed the most valuable license in its history with Samsung. It also signed new agreements with vivo, Honor and HP. Source
• Free cash flow $473.9 million: Full-year free cash flow was $473.9 million, against $212.8 million in 2024. The company defines it as operating cash flow less property purchases and capitalized patent costs. Source
• Full-year 2026 revenue guided: Full-year 2026 guidance is revenue of $675 million to $775 million and adjusted EBITDA of $381 million to $477 million, including expected contributions from new agreements or enforcement actions. Source
• First-quarter 2026 revenue guided: First-quarter 2026 guidance is revenue of $194 million to $200 million and adjusted EBITDA of $101 million to $110 million, covering existing licenses only. Source

“Through the year we accelerated momentum across our licensing programs, including a record performance in smartphones”

InterDigital President and CEO, Liren Chen

Guidance

What changed from last quarter

• New: Courts in Brazil and Germany awarded injunctions against Disney video streaming services. The prior release did not mention these. Source
• New: Full-year highlights name new license agreements with vivo, Honor and HP. The prior release did not name these vendors. Source

Full-year and fourth-quarter results

• Full-year revenue down 4%: Full-year revenue was $834.0 million, down 4% from $868.5 million. Management described it as near-record. Source
• Fourth-quarter revenue down 37%: Fourth-quarter revenue was $158.2 million, down 37% from $252.8 million. The company said lower catch-up revenue drove the decline. Source
• Full-year net income and EPS: Full-year net income was $406.6 million, up 13%. GAAP diluted EPS was $11.80, down 2%; non-GAAP EPS was $15.31, up 2%. Source
• Adjusted EBITDA margin rose to 71%: Full-year adjusted EBITDA was $588.9 million, up 7%, at a 71% margin against 63%. Fourth-quarter adjusted EBITDA was $88.2 million against $198.1 million. Source
• Fourth-quarter net income down 68%: Fourth-quarter net income was $43.0 million, down 68% from $133.1 million. Diluted EPS was $1.20 against $4.09. Source

Revenue by program and ARR

• ARR up 24% to $582.4 million: Annualized recurring revenue rose 24% to $582.4 million from $468.0 million. ARR is quarterly revenue less catch-up revenue, multiplied by four. Source
• Smartphone revenue up 14% for year: Smartphone revenue was $678.9 million for the year, up from $597.5 million. Fourth-quarter smartphone revenue was $123.4 million, down from $230.6 million. Source
• CE, IoT and auto revenue down 42%: CE, IoT/Auto revenue was $154.6 million for the year, down from $268.7 million. Fourth-quarter CE, IoT/Auto revenue rose to $34.8 million from $21.8 million. Source
• Full-year catch-up revenue fell: Full-year catch-up revenue was $277.4 million, against $460.1 million. The 2024 figure was primarily from the Samsung TV, OPPO and Lenovo matters. Source

“we drove double digit growth in our patent portfolio to help us deliver long-term value for shareholders”

InterDigital President and CEO, Liren Chen

Licensing deals and enforcement

• Samsung, vivo, Honor and HP deals: The company said it completed the most valuable license in its history with Samsung. It also signed new agreements with vivo, Honor and HP. Source
• Disney injunctions in Brazil and Germany: Courts in Brazil and Germany awarded injunctions against Disney video streaming services, listed among full-year 2025 highlights. Source
• Fourth-quarter catch-up tied to OPPO, Lenovo: Fourth-quarter catch-up revenue of $12.6 million related primarily to the 2024 OPPO license agreement and the Lenovo arbitration. The prior-year quarter had $135.8 million. Source

Costs, margins and share count

• Operating expenses down $55.8 million: Full-year operating expenses were $373.2 million, down from $429.0 million, mainly lower revenue-share costs. Licensing expense was $93.6 million against $169.2 million. Source
• Fourth-quarter operating expenses up 22%: Fourth-quarter operating expenses were $110.4 million, up 22% from $90.3 million. Income from operations was $47.8 million against $162.5 million. Source
• Margins higher for full year: Full-year net income margin was 49% against 41%, and adjusted EBITDA margin was 71% against 63%. Fourth-quarter net income margin was 27% against 53%. Source
• Diluted share count increased: Full-year weighted average GAAP diluted shares were 34.5 million, against 29.7 million. The non-GAAP count, after the convertible notes adjustment, was 30.4 million. Source
• One-time severance in other items: Other items added back for non-GAAP were $7.4 million for the year and $7.9 million in the fourth quarter, including severance from executive and non-executive departures. Source

“we significantly deepened our AI expertise and industry leadership in our research teams”

InterDigital President and CEO, Liren Chen

Cash flow and balance sheet

• Free cash flow $473.9 million: Full-year free cash flow was $473.9 million, against $212.8 million in 2024. The company defines it as operating cash flow less property purchases and capitalized patent costs. Source
• Operating cash flow $544.5 million: Operating cash flow was $544.5 million for the year against $271.5 million. Fourth-quarter operating cash flow was $63.4 million against $192.0 million. Source
• Patent and equipment spending rose: Capitalized patent costs and property and equipment totaled $70.5 million for the year, against $58.7 million. The fourth-quarter amount was $15.3 million. Source
• Cash and short-term investments rose: Cash, cash equivalents and short-term investments were $1,243.2 million at December 31, 2025, against $958.2 million. Current portion of long-term debt was $458.4 million. Source
• Deferred revenue fell since September: Current deferred revenue was $193.7 million at December 31, 2025, down from $234.5 million at September 30, 2025. Source

Returns to shareholders and notes

• Full-year capital return $169.4 million: Full-year return of capital was $169.4 million: 0.4 million shares repurchased for $102.3 million, and $67.1 million of dividends declared at $2.60 per share. Source
• Fourth-quarter buybacks and dividend: In the fourth quarter the company repurchased 0.1 million shares for $35.7 million and declared $18.0 million of dividends at $0.70 per share. Source
• 2027 notes convertible in Q1 2026: The 3.50% notes due 2027 are convertible during the quarter ending March 31, 2026. The prior release gave the quarter ending December 31, 2025. Source
• Conversion price moved to $105.67: Call spread transactions raise the economic conversion price to $105.67, from $105.77 in the prior release. The conversion rate is 12.9041 shares per $1,000 principal. Source

2026 guidance

• Full-year 2026 revenue guided: Full-year 2026 guidance is revenue of $675 million to $775 million and adjusted EBITDA of $381 million to $477 million, including expected contributions from new agreements or enforcement actions. Source
• First-quarter 2026 revenue guided: First-quarter 2026 guidance is revenue of $194 million to $200 million and adjusted EBITDA of $101 million to $110 million, covering existing licenses only. Source
• 2026 EPS ranges given: Diluted EPS guidance is $1.61 to $1.86 for Q1 2026 and $5.77 to $8.51 for 2026. Non-GAAP EPS guidance is $2.39 to $2.68 and $8.74 to $11.84. Source
• 2026 net income ranges given: Net income guidance is $57 million to $66 million for Q1 2026 and $202 million to $298 million for 2026. Non-GAAP net income guidance is $74 million to $83 million and $271 million to $367 million. Source

Research, AI and patent portfolio

• AI research expertise deepened: Management said it significantly deepened AI expertise and industry leadership in its research teams during 2025. Source
• Patent portfolio grew 14%: The patent portfolio grew 14% to about 38,000 granted patents and patent applications during 2025. Source
• Research and development spending up: Research and portfolio development expense was $211.4 million for the year, up from $196.9 million. Fourth-quarter expense was $57.3 million against $49.1 million. Source
• Deep Render acquired, costs adjusted: The company acquired video AI start-up Deep Render. Costs of that acquisition were among the one-time other items adjusted out of non-GAAP results. Source

Figures management reported

Risks management discussed

• Demand: Full-year 2026 guidance depends on contributions from new agreements or enforcement actions that the company may sign or receive. First-quarter guidance excludes them. Source
• Financial: The 2027 notes are convertible in Q1 2026. On conversion the company pays cash up to principal, with any excess settled in cash, shares or both at its election. Source

Earlier plans management reported on

• Not stated: Management says ARR is used to show progress toward 2030 targets. The documents give no target figure or progress status. Source

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.