InterDigital, Inc. (IDCC - Free Report) reported impressive third-quarter 2021 results, wherein both the bottom line and the top line surpassed their respective Zacks Consensus Estimate. Accretive licensing agreements supported by solid top-line expansion drove the company’s financial performance. In response to the results, shares of this Wilmington, DE-based company inched up 0.4% to close at $71.88 on Nov 4, thereby instilling optimism among investors.
Net Income
Net income in the September quarter was $26.2 million or 83 cents per share compared with $23.8 million or 76 cents per share in the prior-year quarter. The improvement was largely due to solid top-line growth and higher operating income. Adjusted earnings in the reported quarter were 83 cents per share, which topped the Zacks Consensus Estimate of 38 cents, delivering a surprise of 118.4%.
InterDigital, Inc. Price, Consensus and EPS Surprise
Revenues
Total revenues increased to $143.5 million from $87.5 million in the prior-year quarter. The 64% surge in revenues was largely driven by additional revenues from 10 new patent license agreements signed in the last 12 months, including an agreement with a top 10 global TV manufacturer signed in the reported quarter. This was partly offset by a reduction in recurring revenues due to a handset manufacturer exiting the business in the past year. The top line surpassed the consensus estimate of $120 million.
While total revenues from patent royalties equaled $142.7 million, the same from current technology solutions was $0.7 million. Recurring revenues were $93.4 million compared with $87 million a year ago.
During the quarter, InterDigital inked an agreement with China-based handset manufacturer Xiaomi for licensing its patent portfolio. This underscores the strength of its portfolio across several key technologies related to cellular wireless, including 3G, 4G, and 5G, Wi-Fi, and HEVC video technology. Approximately 80 companies across the globe license InterDigital’s patent technology, including leading firms like Apple, Huawei, Samsung, and Sony.
Other Details
Total operating expenses increased to $106.7 million from $72.1 million in the prior-year quarter, primarily driven by non-recurring charges of $26.1 million mostly related to restructuring initiatives. Operating income was $36.8 million compared with $15.4 million a year ago, due to higher revenues.
Cash Flow & Liquidity
During the first nine months of 2021, InterDigital generated $59.2 million of net cash from operating activities compared with $144.2 million in the year-ago period. As of Sep 30, 2021, the company had $900.8 million in cash, cash equivalents, and short-term investments with $480.6 million of long-term debt and other liabilities.
Zacks Rank & Stocks to Consider
InterDigital currently has a Zacks Rank #4 (Sell). Some better-ranked stocks in the broader industry are Harmonic Inc. (HLIT - Free Report) , SeaChange International, Inc. (SEAC - Free Report) , and Aviat Networks, Inc. (AVNW - Free Report) . While Harmonic sports a Zacks Rank #1 (Strong Buy), SeaChange International and Aviat Networks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Harmonic delivered a trailing four-quarter earnings surprise of 61.1%, on average.
SeaChange International delivered a trailing four-quarter earnings surprise of 28.9%, on average.
Aviat Networks delivered a trailing four-quarter earnings surprise of 32.1%, on average.
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No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%. Zacks predicts another significant surge in months to come.
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InterDigital, Inc. (IDCC - Free Report) reported impressive third-quarter 2021 results, wherein both the bottom line and the top line surpassed their respective Zacks Consensus Estimate. Accretive licensing agreements supported by solid top-line expansion drove the company’s financial performance. In response to the results, shares of this Wilmington, DE-based company inched up 0.4% to close at $71.88 on Nov 4, thereby instilling optimism among investors.
Net Income
Net income in the September quarter was $26.2 million or 83 cents per share compared with $23.8 million or 76 cents per share in the prior-year quarter. The improvement was largely due to solid top-line growth and higher operating income. Adjusted earnings in the reported quarter were 83 cents per share, which topped the Zacks Consensus Estimate of 38 cents, delivering a surprise of 118.4%.
InterDigital, Inc. Price, Consensus and EPS Surprise
Revenues
Total revenues increased to $143.5 million from $87.5 million in the prior-year quarter. The 64% surge in revenues was largely driven by additional revenues from 10 new patent license agreements signed in the last 12 months, including an agreement with a top 10 global TV manufacturer signed in the reported quarter. This was partly offset by a reduction in recurring revenues due to a handset manufacturer exiting the business in the past year. The top line surpassed the consensus estimate of $120 million.
While total revenues from patent royalties equaled $142.7 million, the same from current technology solutions was $0.7 million. Recurring revenues were $93.4 million compared with $87 million a year ago.
During the quarter, InterDigital inked an agreement with China-based handset manufacturer Xiaomi for licensing its patent portfolio. This underscores the strength of its portfolio across several key technologies related to cellular wireless, including 3G, 4G, and 5G, Wi-Fi, and HEVC video technology. Approximately 80 companies across the globe license InterDigital’s patent technology, including leading firms like Apple, Huawei, Samsung, and Sony.
Other Details
Total operating expenses increased to $106.7 million from $72.1 million in the prior-year quarter, primarily driven by non-recurring charges of $26.1 million mostly related to restructuring initiatives. Operating income was $36.8 million compared with $15.4 million a year ago, due to higher revenues.
Cash Flow & Liquidity
During the first nine months of 2021, InterDigital generated $59.2 million of net cash from operating activities compared with $144.2 million in the year-ago period. As of Sep 30, 2021, the company had $900.8 million in cash, cash equivalents, and short-term investments with $480.6 million of long-term debt and other liabilities.
Zacks Rank & Stocks to Consider
InterDigital currently has a Zacks Rank #4 (Sell). Some better-ranked stocks in the broader industry are Harmonic Inc. (HLIT - Free Report) , SeaChange International, Inc. (SEAC - Free Report) , and Aviat Networks, Inc. (AVNW - Free Report) . While Harmonic sports a Zacks Rank #1 (Strong Buy), SeaChange International and Aviat Networks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Harmonic delivered a trailing four-quarter earnings surprise of 61.1%, on average.
SeaChange International delivered a trailing four-quarter earnings surprise of 28.9%, on average.
Aviat Networks delivered a trailing four-quarter earnings surprise of 32.1%, on average.
Highest Returns for Any Asset Class
It’s not even close. Despite ups and downs, Bitcoin has been more profitable for investors than any other decentralized, borderless form of money.
No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%. Zacks predicts another significant surge in months to come.
Hurry, Download Special Report – It’s FREE >>
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