Video tech company InterDigital beats Q2 profit view on HP license deal, hikes FY forecast

Overview

• InterDigital Q2 revenue up 34% yr/yr, beating analyst expectations, per LSEG data

• Adjusted EPS at record $6.52, surpassing analyst estimates, per LSEG data

• Company raises full-year 2025 revenue guidance by $110 mln

Outlook

• InterDigital raises full-year 2025 revenue guidance to $790-$850 mln

• Company expects Q3 2025 revenue between $136 mln and $140 mln

• InterDigital forecasts full-year 2025 adjusted EBITDA of $551-$569 mln

• Company anticipates Q3 2025 adjusted EBITDA of $69-$75 mln

• ** Sees FY non-GAAP EPS of $14.17 - $14.77; Q3 non-GAAP EPS of $1.52 - $1.72

Result Drivers

• SAMSUNG ARBITRATION - Conclusion of arbitration with Samsung significantly boosted revenue, per CEO Liren Chen

• HP LICENSE AGREEMENT - New licensing agreement with HP contributed to revenue growth

• RECURRING REVENUE - Annualized recurring revenue reached a record high, up 44% YoY

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", 2 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the communications & networking peer group is "buy"

• Wall Street's median 12-month price target for InterDigital Inc is $215.00, about 14% below its July 30 closing price of $245.18

• The stock recently traded at 29 times the next 12-month earnings vs. a P/E of 26 three months ago

Press Release: ID:nGNX4f6Yjx