InterDigital, Inc.
For the period ended Jun 30, 2025. Filed Jul 31, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 31, 2025
IDCC$285.28-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-01.
0001405495-25-000022
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-31.
0001405495-25-000051
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 86 previous paragraphs and 103 current paragraphs.
46 unchanged; 31 reworded; 21 added; 8 removed; 1 previous and 5 current paragraphs rearranged.
Tables are not compared: 11 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
Samsung Arbitration and New Agreements
Current report
On July 28, 2025, a panel of International Chamber of Commerce arbitrators determined the royalties of the patent license between InterDigital Inc. and Samsung Electronics Co., Ltd(“Samsung”) covering Samsung’s products other than digital televisions and computer display monitors, which have been licensed under a separate agreement.
Current report
The arbitration panel set the total royalties at $1.05 billion for the eight-year patent license, which commenced on January 1, 2023 and runs through December 31, 2030. Under this agreement, InterDigital will recognize approximately $131 million of recurring revenue per year, a 67% increase from the previous license agreement. In second quarter 2025, the agreement contributed $119 million of catch-up revenue in addition to $33 million of recurring revenue.
Current report
Second Quarter 2025 Compared to Second Quarter 2024
Current report
Revenue
Current report
The following table compares second quarter 2025 revenue to second quarter 2024 revenue (in thousands):
Current report
Total revenue of $300.6 million increased $77.1 million from second quarter 2024 primarily due to the Samsung arbitration decision and the new HP agreement. Additionally, revenue from eight other new patent license agreements signed in the last twelve months, including the previously announced agreements with vivo Mobile and OPPO, and the Lenovo arbitration agreement contributed to the increase. These increases were partially offset primarily by catch-up revenue recognized related to the Lenovo UK proceedings in second quarter 2024.
Current report
Operating expenses increased $5.6 million to $95.2 million in second quarter 2025 compared to $89.6 million in second quarter 2024. The $5.6 million increase in total operating expenses was primarily due to changes in the following items (in thousands):
Current report
The $5.6 million increase in operating expenses was driven by an increase in performance-based compensation due to higher accrual rates driven by licensing successes and a $2.1 million increase in depreciation and amortization due to non-cash patent acquisitions and investments in internal infrastructure. Additionally, the increase was due to a $3.2 million one-time contra expense for a net litigation fee reimbursement resulting from intellectual property enforcement successes received in second quarter 2024. These increases were partially offset by a $6.6 million decrease in intellectual property enforcement costs primarily due to our fourth quarter 2024 resolution of the OPPO and Lenovo proceedings, as well as decreased activity related to the Samsung arbitration.
Current report
Research and portfolio development expense: Research and portfolio development expense increased compared to second quarter 2024 primarily due to the increase in depreciation and amortization noted above, as well as the increase in performance-based compensation costs.
Current report
Licensing expense: Licensing expense was relatively flat compared to second quarter 2024, with the above noted one-time net litigation fee reimbursement contra expense recognized in second quarter 2024 and increased performance-based compensation being offset by the above-noted decreased intellectual property enforcement costs.
Current report
Non-Operating Income, net
Current report
The following table compares second quarter 2025 non-operating income, net to second quarter 2024 (in thousands):
Current report
First Half 2025 Compared to First Half 2024
Current report
Revenue
Current report
The following table compares first half 2025 revenue to first half 2024 revenue (in thousands):
Current report
Operating Expenses
Current report
The $75.5 million decrease in operating expenses was driven by a $66.5 million decrease in revenue share costs primarily related to the Samsung TV agreements signed in first half 2024 and a $18.9 million decrease in intellectual property enforcement costs primarily due to our fourth quarter 2024 resolution of the OPPO and Lenovo proceedings, as well as the Samsung arbitration. This decrease in intellectual property enforcement costs was partially offset by one-time contra expenses for net litigation fee reimbursements of $0.5 million in first half 2025 compared to $3.2 million in first half 2024 resulting from intellectual property enforcement successes.
Current report
These decreases were offset by a $3.1 million increase in depreciation and amortization due to non-cash patent acquisitions and investments in internal infrastructure and a $2.8 million increase in performance-based compensation due to higher accrual rates driven by licensing successes.
Current report
General and administrative expense: General and administrative expense increased compared to first half 2024 primarily due to the above noted increase in performance-based compensation.
Removed paragraphs (8)
Previous report
New Agreement
Previous report
In March 2025, we signed a new multi-year, worldwide, non-exclusive, royalty bearing license agreement with vivo Mobile, a major Chinese smartphone vendor. We now have seven of the ten largest smartphone vendors and almost 80% of the entire global smartphone market under license.
Previous report
Subsequent Events
Previous report
Cash flows (used in) provided by operating activities
Previous report
First Quarter 2025 Compared to First Quarter 2024
Previous report
Revenues
Previous report
The following table compares first quarter 2025 revenues to first quarter 2024 revenues (in thousands):
Previous report
Operating expenses decreased $81.1 million primarily due to revenue share costs related to the catch-up revenues recognized from the Samsung TV agreement signed in first quarter 2024. Additionally, intellectual property enforcement costs decreased $12.8 million primarily due to our fourth quarter 2024 resolution of the OPPO and Lenovo proceedings, as well as the Samsung arbitration.
Reworded paragraphs (31)
Previous wording
Throughout the following discussion and elsewhere in this Form 10-Q, we refer to “catch-up revenues.” For variable and dynamic fixed-fee license agreements, “catch-up revenues” primarily represents revenue associated with reporting periods prior to the execution of the license agreement.
Current wording
Throughout the following discussion and elsewhere in this Form 10-Q, we refer to “catch-up revenue.” For variable and dynamic fixed-fee license agreements, “catch-up revenue” primarily represents revenue associated with reporting periods prior to the execution of the license agreement.
Previous wording
In April 2025, we signed a new multi-year license agreement with HP Inc. The agreement licenses HP personal computers to InterDigital’s Wi-Fi and video decoding technologies. No revenue related to this agreement was recognized in first quarter 2025.
Current wording
In April 2025, we signed a new multi-year license agreement with HP Inc. The agreement licenses HP personal computers to InterDigital’s Wi-Fi and video decoding technologies.
Previous wording
In February 2025, we announced an additional increase in the quarterly cash dividend by $0.15 per share to $0.60 per share, beginning with the quarterly dividend payable in second quarter 2025. During first quarter 2025, we returned $20.8 million to shareholders, including $15.6 million, or $0.60 per share, of cash dividends declared and $5.2 million through the repurchase of shares of common stock.
Current wording
During second quarter 2025, we returned $41.7 million to shareholders, including $15.5 million, or $0.60 per share, of cash dividends declared and $26.2 million through the repurchase of shares of common stock.
Previous wording
As of April 30, 2025, there was $216.1 million remaining under the share repurchase authorization, which we plan to utilize to periodically repurchase additional common shares. See Part II, Item II -Unregistered Sales of Equity Securities and Use of Proceeds—Issuer Purchases of Equity Securities of this Quarterly Report on Form 10-Q.
Current wording
As of July 31, 2025, there was $182.7 million remaining under the share repurchase authorization, which we plan to utilize to periodically repurchase additional common shares. See Part II, Item II -Unregistered Sales of Equity Securities and Use of Proceeds—Issuer Purchases of Equity Securities of this Quarterly Report on Form 10-Q.
Previous wording
As of March 31, 2025, we had $894.8 million of cash, restricted cash, and short-term investments and over $1.6 billion of cash payments due under contracted fixed price agreements, which includes our conservative estimates of the minimum cash receipts that we expect to receive under the Samsung and Lenovo arbitrations.
Current wording
As of June 30, 2025, we had $947.9 million of cash, restricted cash, and short-term investments and nearly $2.0 billion of cash payments due under contracted fixed price agreements, which includes our conservative estimates of the minimum cash receipts that we expect to receive under the Lenovo arbitration.
Previous wording
92% of our first quarter 2025 revenues are from fixed-fee agreements. Such agreements often have prescribed payment schedules that are uneven and sometimes front-loaded, resulting in timing differences between when we collect the cash payments and recognize the related revenue.
Current wording
97% of our second quarter 2025 revenue is from fixed-fee agreements. Such agreements often have prescribed payment schedules that are uneven and sometimes front-loaded, resulting in timing differences between when we collect the cash payments and recognize the related revenue.
Previous wording
The following table reconciles the timing differences between cash receipts and recognized revenue during the three months ended March 31, 2025 and 2024, including the resulting operating cash flow (in thousands):
Current wording
The following table reconciles the timing differences between cash receipts and recognized revenue during the three and six months ended June 30, 2025 and 2024, including the resulting operating cash flow (in thousands):
Previous wording
(a) Fixed fee cash receipts are comprised of cash receipts from Dynamic Fixed-Fee Agreement royalties, including the associated catch-up revenues.
Current wording
(a) Fixed fee cash receipts are comprised of cash receipts from Dynamic Fixed-Fee Agreement royalties, including the associated catch-up revenue.
Previous wording
(b) Other cash receipts are primarily comprised of cash receipts related to our variable patent royalty revenue and catch-up revenues.
Current wording
(b) Other cash receipts are primarily comprised of cash receipts related to our variable patent royalty revenue and catch-up revenue.
Previous wording
First quarter 2025 revenues of $210.5 million includes $84.8 million of catch-up revenues, while first quarter 2024 revenues of $263.5 million includes $166.7 million of catch-up revenues. The $53.0 million decrease was primarily due to catch-up revenues from the Samsung TV agreement recognized in first quarter 2024, partially offset by revenues recognized from new agreements signed over the last twelve months. In first quarter 2025, revenues (in descending order) from vivo Mobile, Apple, and Samsung each comprised 10% or more of our consolidated revenues. Refer to "Results of Operations --First Quarter 2025 Compared to First Quarter 2024" for further discussion of our 2025 revenue.
Current wording
Second quarter 2025 revenue of $300.6 million includes $162.3 million of catch-up revenue, while second quarter 2024 revenue of $223.5 million includes $127.6 million of catch-up revenue. The $77.1 million increase was primarily due to revenue from the Samsung arbitration decision and the HP agreement, and was partially offset by catch-up revenue from the Lenovo UK proceedings recognized in second quarter 2024. In second quarter 2025, revenue (in descending order) from Samsung, HP, and Apple each comprised 10% or more of our consolidated revenue. Refer to "Results of Operations --Second Quarter 2025 Compared to Second Quarter 2024" for further discussion of our 2025 revenue.
Previous wording
When comparing first quarter 2025 financial results against other periods, the following items should be taken into consideration:
Current wording
When comparing second quarter 2025 financial results against other periods, the following items should be taken into consideration:
Previous wording
•Our first quarter 2025 revenues include $84.8 million of catch-up revenues primarily related to a new patent license agreement with vivo Mobile signed in first quarter 2025.
Current wording
•Our second quarter 2025 revenue includes $162.3 million of catch-up revenue primarily related to the Samsung arbitration decision and the new patent license agreement with HP signed in second quarter 2025.
Previous wording
The net decrease in cash, cash equivalents, restricted cash, and short-term investments was attributable to cash used in financing activities of $43.0 million, cash used in investing activities of $26.7 million, excluding sales and purchases of short-term investments, and cash used in operating activities of $20.0 million. Refer to the sections below for further discussion of these items.
Current wording
The net decrease in cash, cash equivalents, restricted cash, and short-term investments was attributable to cash used in financing activities of $85.6 million and cash used in investing activities of $40.2 million, excluding sales and purchases of short-term investments, partially offset by cash provided by operating activities of $85.1 million. Refer to the sections below for further discussion of these items.
Previous wording
Cash flows (used in) provided by operating activities in the first quarter 2025 and 2024 (in thousands) were as follows:
Current wording
Cash flows provided by operating activities in the first half 2025 and 2024 (in thousands) were as follows:
Previous wording
Our cash flows (used in) provided by operating activities are principally derived from cash receipts from patent license agreements, offset by cash operating expenses and income tax payments. The $70.8 million change in net cash (used in) provided by operating activities was driven by lower cash receipts primarily due to large cash receipts in first quarter 2024 related to catch-up revenues from agreements signed in first quarter 2024 and due to timing of cash receipts under existing agreements. This decrease was partially offset by lower cash operating expenses primarily due to lower revenue share and litigation costs recognized in first quarter 2025. The table below sets forth the significant items comprising our cash flows provided by operating activities during the three months ended March 31, 2025 and 2024 (in thousands):
Current wording
Our cash flows provided by operating activities are principally derived from cash receipts from patent license agreements, offset by cash operating expenses and income tax payments. The $83.3 million change in net cash provided by operating activities was driven by lower cash operating expenses primarily due to lower revenue share and litigation costs recognized in first half 2025. This change was partially offset by lower cash receipts primarily due to large cash receipts in first half 2024 related to catch-up revenue. The table below sets forth the significant items comprising our cash flows provided by operating activities during the six months ended June 30, 2025 and 2024 (in thousands):
Previous wording
(a) Cash operating expenses include operating expenses less depreciation and disposals of fixed assets, amortization of patents, and non-cash compensation. Amount includes revenue share costs of $2.6 million and $69.0 million in first quarter 2025 and 2024, respectively.
Current wording
(a) Cash operating expenses include operating expenses less depreciation and disposals of fixed assets, amortization of patents, and non-cash compensation. Amount includes revenue share costs of $5.2 million and $71.7 million in first half 2025 and 2024, respectively.
Previous wording
Net cash provided by investing activities for first quarter 2025 was $59.5 million, a $42.7 million change from $16.8 million in first quarter 2024. During first quarter 2025, we sold $86.2 million of short-term marketable securities, net of purchases, and capitalized $26.7 million of patent costs and property and equipment purchases. During first quarter 2024, we sold $24.6 million of short-term marketable securities, net of purchases, and capitalized $9.4 million of patent costs and property and equipment purchases.
Current wording
Net cash used in investing activities for first half 2025 was $22.2 million, a $119.7 million change from $97.5 million provided by investing activities in first half 2024. During first half 2025, we sold $18.0 million of short-term marketable securities, net of purchases, and capitalized $40.2 million of patent costs and property and equipment purchases. During first half 2024, we sold $118.9 million of short-term marketable securities, net of purchases, and capitalized $22.6 million of patent costs and property and equipment purchases.
Previous wording
Net cash used in financing activities for first quarter 2025 was $43.0 million, a change of $6.4 million from $49.3 million the first quarter 2024. This change was primarily attributable to a $23.5 million increase of taxes withheld on restricted stock unit vestings primarily due to the increased share price at vesting, partially offset by a $23.6 million decrease in share repurchases and $7.3 million of proceeds from the exercise of stock options.
Current wording
Net cash used in financing activities for first half 2025 was $85.6 million, a change of $147.7 million from $233.3 million the first half 2024. This change was primarily attributable to a $126.2 million payment made on maturity of the 2024 Notes in first half 2024, a $32.3 million decrease in share repurchases, and $7.3 million of proceeds from the exercise of stock options. This change was partially offset by a $22.9 million increase of taxes withheld on restricted stock unit vestings primarily due to the increased share price at vesting.
Previous wording
Our combined short-term and long-term deferred revenue balance as of March 31, 2025 was approximately $324.4 million, a net decrease of $35.8 million from December 31, 2024. This decrease in deferred revenue was primarily due amortization of deferred revenue recognized in the period, partially offset by cash receipts on new and existing patent license agreements.
Current wording
Our combined short-term and long-term deferred revenue balance as of June 30, 2025 was approximately $291.9 million, a net decrease of $68.2 million from December 31, 2024. This decrease in deferred revenue was primarily due amortization of deferred revenue recognized in the period, partially offset by cash receipts on new and existing patent license agreements.
Previous wording
Based on current license agreements, we expect the amortization of dynamic fixed-fee royalty payments to reduce the March 31, 2025 deferred revenue balance of $324.4 million by $175.3 million over the next twelve months.
Current wording
Based on current license agreements, we expect the amortization of dynamic fixed-fee royalty payments to reduce the June 30, 2025 deferred revenue balance of $291.9 million by $178.3 million over the next twelve months.
Previous wording
During periods in which the average market price of our common stock is above the applicable conversion price of the 2027 Notes (initial conversion price of approximately $77.49 per share), or above the strike price of the warrants (weighted average strike price of $106.14 per share), the impact of conversion or exercise, as applicable, would be dilutive and such dilutive effect is reflected in diluted earnings per share. As a result, in periods where the average market price of our common stock is above the conversion price or strike price, as applicable, under the if-converted method, we calculate the number of shares issuable under the terms of the 2027 Notes and the 2027 Warrant Transactions based on the average market price of the stock during the period, and include that number in the total diluted shares outstanding for the period.
Current wording
During periods in which the average market price of our common stock is above the applicable conversion price of the 2027 Notes (initial conversion price of approximately $77.49 per share), or above the strike price of the warrants (weighted average strike price of $106.06 per share), the impact of conversion or exercise, as applicable, would be dilutive and such dilutive effect is reflected in diluted earnings per share. As a result, in periods where the average market price of our common stock is above the conversion price or strike price, as applicable, under the if-converted method, we calculate the number of shares issuable under the terms of the 2027 Notes and the 2027 Warrant Transactions based on the average market price of the stock during the period, and include that number in the total diluted shares outstanding for the period.
Previous wording
In first quarter 2025 and 2024, 71% and 84%, respectively, of our total revenue was attributable to licensees that individually accounted for 10% or more of our total revenue. In first quarter 2025 and 2024, the following licensees accounted for 10% or more of our total revenue:
Current wording
In second quarter 2025 and 2024, 78% and 80%, respectively, of our total revenue was attributable to licensees that individually accounted for 10% or more of our total revenue. In second quarter 2025 and 2024, the following licensees accounted for 10% or more of our total revenue:
Previous wording
The following table summarizes the changes in operating expenses between first quarter 2025 and first quarter 2024 by category (in thousands):
Current wording
The following table summarizes the changes in operating expenses between second quarter 2025 and second quarter 2024 by category (in thousands):
Previous wording
General and administrative expense: General and administrative expense was relatively flat compared to first quarter 2024.
Current wording
General and administrative expense: General and administrative expense increased compared to second quarter 2024 primarily due to the above noted increase in performance-based compensation.
Previous wording
In first quarter 2025 and 2024, based on the statutory federal tax rate net of discrete federal and state taxes, we had an effective tax rate of 12.6% and 19.2%, respectively. The change in effective tax rate is due to an increase in the amount of Foreign Derived Intangible Income deduction benefit available to the Company and tax benefits related to share-based compensation. In addition, the Company is subject to a decrease in the Global Intangible Low-Tax Income inclusion derived from the increase in revenue in certain foreign jurisdictions.
Current wording
In second quarter 2025 and 2024, based on the statutory federal tax rate net of discrete federal and state taxes, we had an effective tax rate of 14.4% and 18.2%, respectively. The change in effective tax rate is due to an increase in the amount of Foreign Derived Intangible Income deduction benefit available to the Company and tax benefits related to share-based compensation. In addition, the Company is subject to a decrease in the Global Intangible Low-Tax Income inclusion derived from the decrease in revenue in certain foreign jurisdictions.
Previous wording
Total revenues of $210.5 million decreased $53.0 million from first quarter 2024 primarily due to catch-up revenues from the Samsung TV agreement recognized in first quarter 2024, partially offset by catch-up revenues recognized from the new agreement with vivo Mobile signed in first quarter 2025. Additionally, the decrease was partially offset by revenues from seven new patent license agreements signed in the last twelve months, including the vivo Mobile agreement and the previously announced OPPO agreement and the Lenovo arbitration agreement.
Current wording
Total revenue of $511.1 million increased $24.1 million from first half 2024 primarily due to revenue recognized from the Samsung arbitration decision and the first half 2025 agreements with vivo Mobile and HP. Additionally, eight other new patent license agreements signed in the last fifteen months contributed to the increase, including the previously announced OPPO agreement and the Lenovo arbitration agreement. This increase was partially offset by catch-up revenue related to the Samsung TV agreement and the Lenovo UK proceedings recognized in first half 2024.
Previous wording
Operating expenses decreased to $78.7 million in first quarter 2025 from $159.8 million in first quarter 2024. The $81.1 million decrease in total operating expenses was primarily due to changes in the following items (in thousands):
Current wording
Operating expenses decreased 30% to $173.8 million in first half 2025 from $249.4 million in first half 2024. The $75.5 million decrease in total operating expenses was primarily due to changes in the following items (in thousands):
Previous wording
Research and portfolio development expense: Research and portfolio development expense was relatively flat compared to first quarter 2024.
Current wording
Research and portfolio development expense: Research and portfolio development expense increased slightly compared to first half 2024 primarily due to the above noted increase in depreciation and amortization.
Previous wording
Licensing expense: Licensing expense decreased $78.9 million primarily driven by the above-noted decreases in revenue share costs and intellectual property enforcement costs.
Current wording
Licensing expense: Licensing expense decreased by $80.2 million primarily driven by the above-noted decreased revenue share costs and intellectual property enforcement costs, partially offset by the one-time net litigation fee reimbursement.
Previous wording
The following table compares first quarter 2025 non-operating income, net to first quarter 2024 non-operating expense, net (in thousands):
Current wording
The following table compares first half 2025 non-operating income, net to first half 2024 non-operating expense, net (in thousands):
Previous wording
The change in non-operating income (expense), net was primarily due to a foreign currency translation net gain arising from translation of our foreign subsidiaries of $2.2 million in first quarter 2025, compared to a $2.4 million net loss in first quarter 2024.
Current wording
The change in non-operating income (expense), net was primarily due to a foreign currency translation net gain arising from translation of our foreign subsidiaries of $5.8 million in first half 2025, compared to a $3.3 million net loss in first half 2024.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Cash flows provided by operating activities
Current report — wording carried from elsewhere
The change in non-operating income, net was primarily due to a foreign currency translation net gain arising from translation of our foreign subsidiaries of $3.6 million in second quarter 2025, compared to a $0.9 million net loss in second quarter 2024.
Current report — wording carried from elsewhere
In first half 2025 and 2024, 69% and 82% of our total revenue, respectively, was attributable to companies that individually accounted for 10% or more of our total revenue. In first half 2025 and 2024, the following companies accounted for 10% or more of our total revenue:
Current report — wording carried from elsewhere
The following table summarizes the changes in operating expenses between first half 2025 and first half 2024 by category (in thousands):
Current report — wording carried from elsewhere
In first half 2025 and 2024, we had an effective tax rate of 13.7% and 18.6%, respectively. The change in effective tax rate is due to an increase in the amount of Foreign Derived Intangible Income deduction benefit available to the Company and tax benefits related to share-based compensation. In addition, the Company is subject to a decrease in the Global Intangible Low-Tax Income inclusion derived from the decrease in revenue in certain foreign jurisdictions.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
(a) Catch-up revenues represent revenue associated with reporting periods prior to the execution of the license agreement.