InterDigital, Inc. Q4 FY2025 earnings call

• At the start of 2025, aggressive goals were set to grow the company, including driving smartphone licensing revenue growth, building a licensing pipeline, expanding AI research, and growing patent portfolio. Exceeded all goals with strong Q4 performance, full-year revenue $834 million (second-highest in history), ARR $582 million (up 24% yoy), adjusted EBITDA $589 million, non-GAAP EPS over $15.
• Smartphone program: Record year in 2025 with Samsung contract extended to 2030, new deals with Vivo and Honor, now licensed 8 of top 10 smartphone makers covering 85% market. Renewed licenses with Xiaomi in 2026.
• CE and IoT program: Signed new agreements with HP, a significant social media company in Q4, and LG Electronics in 2026, now over 50 license agreements since 2021 with total contract value over $4.6 billion.
• Video service program: Launched enforcement campaign against Disney+ etc., received injunctions in Brazil and Germany, and enforcement against Amazon in Q4.
• AI and research: Acquired DeepRender in Q4 2025 to strengthen AI expertise, actively contributing to 6G standard development, one senior engineer reelected chair of 3GPP working group, patent portfolio grew 14% yoy to over 38,000 granted patents and applications.

In the smartphone program, 2025 revenue was just below $680 million, up 14% year over year to an all-time high. The CE and IoT program saw signing of over 50 license agreements since 2021 with a total contract value of more than $4.6 billion. The video service program had enforcement actions against Disney+ and Amazon. AI was strengthened with the Q4 2025 acquisition of DeepRender. The patent portfolio grew 14% year over year in 2025 to surpass 38,000 granted patents and applications. Q4 2025 total revenue was $158 million, ARR increased 24% year over year to $582 million, adjusted EBITDA was $88 million, GAAP EPS was $1.20, non-GAAP EPS was $2.12.

• Q1 2026 revenue expected $194 million to $200 million, including $55 million to $60 million of catch-up revenue. Adjusted EBITDA margin expected 52% to 55%, non-GAAP diluted EPS $2.39 to $2.68.
• Full-year 2026 guidance: Total revenue $675 million to $775 million, adjusted EBITDA $381 million to $477 million, non-GAAP diluted EPS $8.74 to $11.84.
• ARR increased 24% yoy in Q4 2025 to $582 million, expect to reach $1 billion by 2030 with renewals and new agreements.
• Q1 2026 guidance does not include impact of new agreements or arbitration results in short window; full-year guidance includes potential contributions from new agreements and arbitration results.

• Litigation risks: Any litigation carries inherent risk, and outcomes of cases like Disney and Amazon litigations are uncertain. Timing of new agreements in short windows is hard to predict, affecting predictability of guidance.
• Operational risks: Uncertainty around arbitration results and new agreements not being fully reflected in short-term guidance.

Q: Scott Searle asked about Q1 guidance, specifically catch-up revenue and recurring fees, and timeline for Disney and Amazon litigations.

A: Rich Brezski said about $90 million expirations at end of 2025, renewed two-thirds including Xiaomi, still working on other renewals; Liren Chen said Disney litigations had positive results in Brazil and Germany with more cases starting in summertime and second half of 2026, Amazon case started in Q4 with multiple jurisdictions and ITC involved.

Q: Kevin Durden asked about consumer electronics device agreement with social media company and litigation threats.

A: Liren Chen said the device agreement is not high-volume and not service side; Liren Chen said litigation strategy prefers negotiations, patents are high quality, and litigation campaign doesn't depend on winning every patent but aims for fair value to fund R&D.

Q: Alinda Lee asked about M&A in R&D and differences in streaming service litigation vs others.

A: Liren Chen said open to M&A to fill research gaps, like acquiring DeepRender; Liren Chen said smartphone licensing has long relationships, streaming platform litigation is in early stage needing extra time to demonstrate portfolio strength to convince vendors of fair price