InterDigital Announces Financial Results for Second Quarter 2026
Rhea-AI Summary
InterDigital (Nasdaq: IDCC) reported second quarter 2026 revenue of $260.2 million, down 13% year-over-year, including $103.7 million of catch-up revenue. GAAP net income was $116.4 million and diluted EPS $3.40, both down 36% versus Q2 2025.
Annualized recurring revenue reached a record $625.7 million, up 13% year-over-year, supported by the first Streaming and Cloud Services agreement and a new agreement with Amazon, plus a new IoT license with a leading fintech. InterDigital also obtained two injunctions against Disney from Europe’s Unified Patent Court.
The company raised full-year 2026 guidance to $775–$845 million in revenue and $7.91–$9.67 in diluted EPS, versus prior revenue guidance of $675–$775 million. Q2 2026 return of capital totaled $41.1 million through share repurchases and dividends.
Positive
- Annualized recurring revenue up 13% YoY to $625.7 million
- Raised 2026 revenue outlook to $775–$845 million, +$85m at midpoint
- Streaming and Cloud Services revenue of $110 million versus zero a year ago
- Q2 2026 return of capital of $41.1 million via buybacks and dividends
- $80.3 million of 2027 notes elected for conversion with no incremental shares
- Cash, cash equivalents and restricted cash at June 30, 2026 of $624.4 million
Negative
- Q2 2026 revenue down 13% YoY to $260.2 million
- Q2 net income and diluted EPS both down 36% year-over-year
- Operating expenses up 27% YoY to $120.9 million
- Adjusted EBITDA down 22% YoY to $184.1 million
- Smartphone program revenue down 48% and CE/IoT/Auto down 58% YoY
- Catch-up revenue decreased 36% YoY to $103.7 million
News Explained
The elected note conversions are scheduled for third-quarter settlement without incremental shares, while 6.0 million warrants remain a later common-stock issuance possibility.
InterDigital reports that holders have elected to convert
Under the disclosed terms, the company pays cash up to the principal amount converted and may use cash, common stock, or both for any excess conversion obligation.
Separately, 6.0 million warrants to acquire common stock remain outstanding at a
The near-term checkpoint is settlement of the elected note conversions; the later ownership-related checkpoint is the warrants' stated net-share maturity window.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Apr 30 | Q1 earnings report | Positive | -15.9% | Revenue, recurring revenue, and earnings were reported alongside reaffirmed full-year guidance. |
| Feb 05 | FY earnings report | Positive | +9.9% | Record 2025 results, Samsung licensing, and 2026 guidance supported the announcement. |
| Oct 30 | Q3 earnings report | Positive | +3.5% | Revenue, net income, EPS, and recurring revenue increased year over year. |
| Jul 31 | Q2 earnings report | Positive | +5.3% | Samsung arbitration, an HP license, and raised full-year guidance drove results. |
| May 01 | Q1 earnings report | Positive | +0.6% | Revenue, net income, EPS, and recurring revenue increased against prior-year results. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Tag-specific earnings history showed four positive 24-hour reactions and one negative reaction, including a -15.91% reaction after Q1 2026 earnings.
Key Terms
annualized recurring revenue financial
adjusted EBITDA financial
diluted EPS financial
binding arbitration regulatory
convertible notes financial
call spread transactions financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
First Streaming and Cloud Services agreement drives Q2 results above outlook
Annualized recurring revenue1 at all-time high of
Company raises full year 2026 revenue outlook by
WILMINGTON, Del., July 30, 2026 (GLOBE NEWSWIRE) -- InterDigital, Inc. (Nasdaq: IDCC), a wireless, video, and AI technology research and development company, today announced results for the quarter ended June 30, 2026.
“We have delivered another outstanding quarter, with continued momentum across our business, including our new agreement with Amazon, driving annualized recurring revenue1 to a record
Recent Business Highlights
- Reached agreement with Amazon, covering Amazon’s services and devices, including Amazon Prime Video, with final terms to be determined by binding arbitration
- Signed new IoT license agreement with a leading fintech company covering point-of-sale devices
- Awarded two injunctions against Disney from Europe’s Unified Patent Court covering eleven countries
- Annualized recurring revenue1 ("ARR") increased
13% year-over-year from$553.1 million to$625.7 million
Second Quarter 2026 Financial Summary:
Second quarter 2026 revenue included
| Three Months Ended June 30, | |||||
| ($ in millions, except per share data) | 2026 | 2025 | Change | ||
| GAAP Results: | |||||
| Revenue | (13)% | ||||
| Operating expenses | |||||
| Net income | (36)% | ||||
| Net income margin | (15) ppt | ||||
| Diluted EPS | (36)% | ||||
| Non-GAAP Results: | |||||
| Adjusted EBITDA2 | (22)% | ||||
| Adjusted EBITDA margin2 | (8) ppt | ||||
| Non-GAAP Net income3 | (28)% | ||||
| Non-GAAP EPS3 | (29)% | ||||
| Additional Information: | |||||
| Revenue by type: | |||||
| Annualized recurring revenue1 | |||||
| Catch-up revenue | (36)% | ||||
| Revenue by program: | |||||
| Smartphone | (48)% | ||||
| CE, IoT/Auto | (58)% | ||||
| Streaming and Cloud Services | $— | N/M | |||
| Other | $— | (100)% | |||
| N/M Not meaningful | |||||
Return of Capital
| (in millions, except per share data) | Share Repurchases | Dividends Declared | Total Return of Capital | ||||||
| Shares | Value | Per Share | Value | ||||||
| Second quarter 2026 | <0.1 | ||||||||
Near Term Outlook
The Company raised its full year 2026 outlook and provided an initial outlook for third quarter 2026 in the table below. The outlook for third quarter 2026 covers existing licenses and does not include any new agreements or enforcement action results we may sign or receive over the balance of the third quarter. The outlook for full year 2026 includes both existing licenses and the expected contributions from new agreements and/or enforcement actions we may receive over the balance of the year.
| Full Year 2026 | |||||
| (in millions, except per share data) | Q3 2026 | Current | Prior | ||
| Revenue | |||||
| Adjusted EBITDA2 | |||||
| Diluted EPS | |||||
| Non-GAAP EPS3 | |||||
Convertibility of 2027 Notes
Pursuant to the terms of the Indenture governing InterDigital’s
Upon the conversion of any Notes, InterDigital will pay cash up to the aggregate principal amount of the Notes to be converted, and will pay cash, shares of its Common Stock or a combination of cash and shares of its Common Stock for any conversion obligation in excess of the aggregate principal amount being converted, if any, at InterDigital’s election, as set forth in the Indenture governing the Notes.
At the time InterDigital issued the Notes, InterDigital entered into call spread transactions that together were designed to have the economic effect of reducing the net number of shares that will be issued in the event of conversion of the Notes by, in effect, increasing the conversion price of the Notes from InterDigital’s economic standpoint from
As of June 30, 2026,
As of June 30, 2026, warrants to acquire 6.0 million shares of common stock remain outstanding at a strike price of
Conference Call Information
InterDigital will host a conference call on Thursday, July 30, 2026 at 10:00 a.m. ET to discuss its second quarter 2026 financial performance and other company matters.
For a live webcast of the conference call visit www.interdigital.com and click on the “Webcast” link on the Investors page. The company encourages participants to take advantage of the webcast option.
See below for dial-in details to join the call telephonically:
USA - Toll-Free (800) 715-9871
USA / International Toll +1 (646) 307-1963
Conference ID 5903891 or Conference Name
A replay of the conference call will be available on InterDigital’s website under Events in the Investors section. The replay will be available for one year.
About InterDigital®
InterDigital is a global research and development company focused primarily on wireless, video, artificial intelligence (“AI”), and related technologies. We design and develop foundational technologies that enable connected, immersive experiences in a broad range of communications and entertainment products and services. We license our innovations worldwide to companies providing such products and services, including makers of wireless communications devices, consumer electronics, IoT devices, cars and other motor vehicles, and providers of cloud-based services such as video streaming. As a leader in wireless technology, our engineers have designed and developed a wide range of innovations that are used in wireless products and networks, from the earliest digital cellular systems to 5G and today’s most advanced Wi-Fi technologies. We are also a leader in video processing and video encoding/decoding technology, with a significant AI research effort that intersects with both wireless and video technologies. Founded in 1972, InterDigital is listed on Nasdaq.
InterDigital is a registered trademark of InterDigital, Inc.
For more information, visit the InterDigital website: www.interdigital.com.
For additional financial measures, refer to our second quarter 2026 Form 10-Q and the financial metrics tracker, which are available on the Investor Relations section of our website.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include information regarding our current beliefs, plans and expectations. Words such as “believe,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “forecast,” "outlook," “goal,” “could,” "would," "should," "if," "may," "might," "future," "target," "trend," "seek to," "will continue," "predict," "likely," "in the event," and variations of any such words or similar expressions are intended to identify such forward-looking statements.
Forward-looking statements are made on the basis of management’s current views and assumptions and are not guarantees of future performance. Forward-looking statements, including but not limited to statements regarding our outlook for Q3 and full year 2026, are inherently subject to risks and uncertainties that could cause actual results, and actual events that occur, to differ materially from results contemplated by the forward-looking statements. These risks and uncertainties include, but are not limited to: (i) unanticipated delays or difficulties in the execution of patent license agreements on acceptable terms or at all; (ii) our ability to expand our revenue opportunities by entering into licensing arrangements with streaming and cloud-based service providers; (iii) the initiation of new legal proceedings or the resolution of ongoing legal proceedings, including any awards or judgments relating to such proceedings, and changes in the schedules or costs associated therewith; (iv) our ability to maintain a strong patent portfolio and make strategic decisions related to our intellectual property protection; (v) our ability to successfully integrate Deep Render and to recognize the anticipated benefits of the transaction; (vi) the failure of markets for our technologies to materialize to the extent that we expect; (vii) our continued ability to develop new technologies; (viii) changes in our interpretations of, and assumptions and calculations with respect to the impact on us of, the One Big Beautiful Bill Act, the 2017 Tax Cuts and Jobs Act and other U.S. and non-U.S. tax laws and other tax matters; (ix) the timing and impact of potential regulatory, administrative and legislative matters; (x) the potential effects of macroeconomic conditions or global conflicts; (xi) our ability to hire and retain key personnel; (xii) operational risks, including cybersecurity events, human failures or other difficulties with our information technology systems; and (xiii) risks related to any new accounting standards or our estimates, assumptions and the application of relevant accounting standards, including with respect to revenue recognition.
You should not place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this release. We undertake no duty to revise or update publicly any forward-looking statement for any reason, except as otherwise required by law.
Footnotes
1 Annualized recurring revenue ("ARR") for any quarter is defined as total revenue for the quarter less catch-up revenue for the quarter, multiplied by four. Management believes ARR provides useful information about our financial performance, and our progress toward our 2030 targets. ARR is not a projection or forecast, and actual recurring revenue for any 12-month period will depend on a number of factors beyond our ability to predict or control, including those risks and uncertainties listed above. Additionally, ARR may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
2 Adjusted EBITDA and Adjusted EBITDA margin are supplemental non-GAAP financial measures that InterDigital believes provide investors with important insight into the Company's ongoing business performance. InterDigital defines Adjusted EBITDA as net income plus income tax (provision) benefit, other income, net & interest expense, depreciation and amortization, share-based compensation, and other items. Other items include restructuring costs, impairment charges and other non-recurring items. Adjusted EBITDA margin is Adjusted EBITDA over total revenue. These non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The presentation of these financial measures, which are not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. A reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure is provided below.
3 Non-GAAP net income, Non-GAAP EPS, and Non-GAAP weighted-average diluted shares are supplemental non-GAAP financial measures that InterDigital believes provide investors with important insight into the Company's ongoing business performance. InterDigital defines Non-GAAP net income as net income plus share-based compensation, acquisition related amortization, restructuring costs, impairment charges and one-time adjustments, losses on extinguishments of long-term debt, the related income tax effect of the preceding items, and adjustments to income taxes. Non-GAAP EPS is defined as Non-GAAP net income divided by Non-GAAP weighted-average diluted shares, which adjusts the weighted-average number of common shares outstanding for the dilutive effect of the Company's convertible notes, offset by our hedging arrangements. InterDigital’s computation of these non-GAAP financial measures might not be comparable to similarly named measures reported by other companies. The presentation of these financial measures, which are not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. A reconciliation of each of these metrics to its most directly comparable GAAP financial measure is provided below.
| SUMMARY CONSOLIDATED STATEMENTS OF INCOME (in thousands except per share data) (unaudited) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Revenue | $ | 260,170 | $ | 300,596 | $ | 465,586 | $ | 511,103 | |||||||
| Operating expenses: | |||||||||||||||
| Research and portfolio development | 56,407 | 53,674 | 112,242 | 101,104 | |||||||||||
| Licensing | 34,725 | 23,909 | 86,844 | 41,586 | |||||||||||
| General and administrative | 29,799 | 17,586 | 45,000 | 31,154 | |||||||||||
| Total operating expenses | 120,931 | 95,169 | 244,086 | 173,844 | |||||||||||
| Income from operations | 139,239 | 205,427 | 221,500 | 337,259 | |||||||||||
| Interest expense | (8,583 | ) | (9,537 | ) | (17,650 | ) | (19,408 | ) | |||||||
| Other income, net | 12,722 | 15,144 | 19,322 | 25,402 | |||||||||||
| Income before income taxes | 143,378 | 211,034 | 223,172 | 343,253 | |||||||||||
| Income tax provision | (27,006 | ) | (30,466 | ) | (31,471 | ) | (47,083 | ) | |||||||
| Net income | $ | 116,372 | $ | 180,568 | $ | 191,701 | $ | 296,170 | |||||||
| Net income per common share: | |||||||||||||||
| Basic | $ | 4.51 | $ | 6.97 | $ | 7.44 | $ | 11.47 | |||||||
| Diluted | $ | 3.40 | $ | 5.35 | $ | 5.51 | $ | 8.81 | |||||||
| Weighted-average number of common shares outstanding: | |||||||||||||||
| Basic | 25,831 | 25,917 | 25,776 | 25,829 | |||||||||||
| Diluted | 34,260 | 33,725 | 34,770 | 33,615 | |||||||||||
| Cash dividends declared per common share | $ | 0.70 | $ | 0.60 | $ | 1.40 | $ | 1.20 | |||||||
| SUMMARY CONSOLIDATED CASH FLOWS (in thousands) (unaudited) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net income | $ | 116,372 | $ | 180,568 | $ | 191,701 | $ | 296,170 | |||||||
| Non-cash adjustments | 72,766 | 18,981 | 195,477 | 17,536 | |||||||||||
| Working capital changes | (106,602 | ) | (94,431 | ) | (288,561 | ) | (228,577 | ) | |||||||
| Net cash provided by operating activities | 82,536 | 105,118 | 98,617 | 85,129 | |||||||||||
| Cash flows from investing activities: | |||||||||||||||
| Net sales, maturities, and purchases of short-term investments | (17,714 | ) | (68,178 | ) | 12,061 | 17,987 | |||||||||
| Capitalized expenditures and patent costs | (15,937 | ) | (13,550 | ) | (31,015 | ) | (40,207 | ) | |||||||
| Long-term investments | — | — | 1,709 | — | |||||||||||
| Net cash used in investing activities | (33,651 | ) | (81,728 | ) | (17,245 | ) | (22,220 | ) | |||||||
| Cash flows from financing activities: | |||||||||||||||
| Payments on long-term debt and warrants | (2 | ) | — | (88,019 | ) | (1,284 | ) | ||||||||
| Repurchase of common stock | (22,981 | ) | (26,168 | ) | (31,146 | ) | (31,417 | ) | |||||||
| Dividends paid | (18,106 | ) | (15,577 | ) | (36,086 | ) | (27,134 | ) | |||||||
| Other | (1,003 | ) | (924 | ) | (56,006 | ) | (25,785 | ) | |||||||
| Net cash used in financing activities | (42,092 | ) | (42,669 | ) | (211,257 | ) | (85,620 | ) | |||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | 6,793 | (19,279 | ) | (129,885 | ) | (22,711 | ) | ||||||||
| Cash, cash equivalents, and restricted cash, beginning of period | 617,590 | 548,115 | 754,268 | 551,547 | |||||||||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 624,383 | $ | 528,836 | $ | 624,383 | $ | 528,836 | |||||||
| SUMMARY CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) | |||||||
| June 30, 2026 | December 31, 2025 | ||||||
| Assets | |||||||
| Cash, cash equivalents, and short-term investments | $ | 1,112,411 | $ | 1,243,160 | |||
| Accounts receivable | 193,001 | 69,816 | |||||
| Prepaid and other current assets | 91,151 | 74,994 | |||||
| Property & equipment and patents, net | 339,843 | 342,469 | |||||
| Other long-term assets, net | 455,686 | 333,851 | |||||
| Total assets | $ | 2,192,092 | $ | 2,064,290 | |||
| Liabilities and Shareholders' equity | |||||||
| Current portion of long-term debt | $ | 378,239 | $ | 458,376 | |||
| Current deferred revenue | 325,740 | 193,722 | |||||
| Other current liabilities | 97,091 | 100,404 | |||||
| Long-term deferred revenue | 116,472 | 135,882 | |||||
| Long-term debt & other long-term liabilities | 72,381 | 74,786 | |||||
| Total liabilities | 989,923 | 963,170 | |||||
| Total shareholders' equity | 1,202,169 | 1,101,120 | |||||
| Total liabilities and shareholders' equity | $ | 2,192,092 | $ | 2,064,290 | |||
| RECONCILIATION OF NON-GAAP MEASURES |
The following tables present InterDigital's GAAP financial measures reconciled to the non-GAAP financial measures included in this release for the second quarter ended June 30, 2026 and 2025:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| (in thousands) | (in thousands) | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Net income | $ | 116,372 | $ | 180,568 | $ | 191,701 | $ | 296,170 | |||||||
| Income tax provision | 27,006 | 30,466 | 31,471 | 47,083 | |||||||||||
| Other income, net & interest expense | (4,139 | ) | (5,607 | ) | (1,672 | ) | (5,994 | ) | |||||||
| Depreciation and amortization | 19,482 | 19,465 | 38,690 | 37,678 | |||||||||||
| Share-based compensation | 24,103 | 11,836 | 34,442 | 21,334 | |||||||||||
| Other items(a) | 1,255 | — | 1,255 | (483 | ) | ||||||||||
| Adjusted EBITDA2 | $ | 184,079 | $ | 236,728 | $ | 295,887 | $ | 395,788 | |||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| (in thousands, except for per share data) | (in thousands, except for per share data) | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Net income | $ | 116,372 | $ | 180,568 | $ | 191,701 | $ | 296,170 | |||||||
| Share-based compensation | 24,103 | 11,836 | 34,442 | 21,334 | |||||||||||
| Acquisition related amortization | 8,000 | 8,900 | 15,978 | 17,550 | |||||||||||
| Other operating items(a) | 1,255 | — | 1,255 | (483 | ) | ||||||||||
| Other non-operating items(b) | (967 | ) | — | (967 | ) | — | |||||||||
| Related income tax effect of above items | (6,802 | ) | (4,355 | ) | (10,649 | ) | (8,065 | ) | |||||||
| Adjustments to income taxes | (563 | ) | (1,667 | ) | (10,967 | ) | (5,566 | ) | |||||||
| Non-GAAP net income3 | $ | 141,398 | $ | 195,282 | $ | 220,793 | $ | 320,940 | |||||||
| Weighted-average dilutive shares - GAAP | 34,260 | 33,725 | 34,770 | 33,615 | |||||||||||
| Less: Dilutive impact of the Convertible Notes | 3,669 | 3,791 | 4,033 | 3,731 | |||||||||||
| Weighted-average dilutive shares - Non-GAAP3 | 30,591 | 29,934 | 30,737 | 29,884 | |||||||||||
| Diluted EPS | $ | 3.40 | $ | 5.35 | $ | 5.51 | $ | 8.81 | |||||||
| Non-GAAP EPS3 | $ | 4.62 | $ | 6.52 | $ | 7.18 | $ | 10.74 | |||||||
(a) Other items in the above tables include one-time expenses related to litigation fee reimbursements in three and six months ended June 30, 2026, compared to one-time contra-expenses related to litigation fee reimbursements in six months ended June 30, 2025.
(b) Other non-operating items includes gains from observable price changes of our long-term strategic investments.
The following tables present a reconciliation between GAAP and non-GAAP versions of the estimated financial measures for the third quarter of 2026 and full year fiscal 2026 included in this release:
| Outlook | ||||||||
| (in millions) | ||||||||
| Full Year 2026 | ||||||||
| Q3 2026 | Current | Prior | ||||||
| Net income | ||||||||
| Income tax provision | 11 | 59 | 48 | |||||
| Other income, net & interest expense | — | (1 | ) | (4 | ) | |||
| Depreciation and amortization | 20 | 79 | 80 | |||||
| Share-based compensation | 13 | 61 | 52 | |||||
| Other items | — | 1 | 3 | |||||
| Adjusted EBITDA2 | ||||||||
| Outlook | ||||||||
| (in millions) | ||||||||
| Full Year 2026 | ||||||||
| Q3 2026 | Current | Prior | ||||||
| Net income | ||||||||
| Share-based compensation | 13 | 61 | 52 | |||||
| Acquisition related amortization | 8 | 32 | 32 | |||||
| Other operating items | — | 1 | 3 | |||||
| Other non-operating items | — | (1 | ) | — | ||||
| Related income tax effect of above items | (4 | ) | (20 | ) | (18 | ) | ||
| Adjustments to income taxes | — | (11 | ) | — | ||||
| Non-GAAP net income3 | ||||||||
| Weighted-average dilutive shares - GAAP | 33.7 | 34.1 | 35.0 | |||||
| Less: Dilutive impact of the Convertible Notes | 3.3 | 3.5 | 4.0 | |||||
| Weighted-average dilutive shares - Non-GAAP3 | 30.4 | 30.6 | 31.0 | |||||
| Diluted EPS | ||||||||
| Non-GAAP EPS3 | ||||||||
| CONTACT: | InterDigital, Inc. |
| Email: investor.relations@interdigital.com | |
| +1 (302) 300-1857 |
