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InterDigital, Inc. (IDCC - Free Report) reported strong third-quarter 2024 results, with the adjusted earnings and revenues surpassing the respective Zacks Consensus Estimates.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
The company generated higher revenues year over year, driven by solid licensing momentum and product innovation. IDCC is also advancing its leadership position in AI (artificial intelligence) applications for wireless and video technology.
Net Income
Quarterly net income decreased to $34.19 million or $1.14 per share from $47.94 million or $1.72 per share in the year-earlier quarter. The decline was attributable to top-line contraction.
Non-GAAP net income was $44.92 million or $1.63 per share, down from $57.68 million or $2.13 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 76 cents.
InterDigital, Inc. Price, Consensus and EPS Surprise
Net sales in the quarter fell to $128.68 million from $140.11 million in the year-ago quarter. The year-over-year decline was induced by lower catch-up revenues in smartphone licensing programs during the quarter and the expiration of the Huawei agreement. The top line, however, beat the consensus estimate of $97 million.
In the third quarter, total recurring revenues were $98.6 million, down from $104.5 million in the year-ago quarter. Smartphone revenues decreased 16% year over year to $87.4 million. Net sales from CE, loT/Auto increased to $40.6 million from $35.4 million in the year-ago quarter. Total catch-up revenues were down to $30 million from $35.6 million.
Other Details
Adjusted EBITDA decreased to $64.8 million from $83.5 million in the year-ago quarter. Total operating expenses rose to $89.3 million from $86.4 million in the year-ago quarter. The increase in operating costs is attributed to higher licensing-related expenses. Operating income declined to $39.3 million from $53.6 million in the year-earlier quarter.
Cash Flow & Liquidity
In the third quarter, InterDigital generated $77.6 million in cash from operating activities compared with $310.6 million in the year-earlier quarter. As of Sept. 30, 2024, it had $813.2 million in cash, cash equivalents and short-term investments, with $74.4 million of long-term debt and other liabilities.
Guidance Up
For 2024, with solid traction across the business led by a recent license agreement with Oppo and a binding arbitration agreement with Lenovo, the company expects revenues in the range of $855-$865 million, up from $690-$740 million expected earlier. Adjusted EBITDA is forecasted at $533-$543 million, up from $378-$416 million estimated earlier. IDCC now expects non-GAAP earnings in the band of $14.69-$14.99, up from the prior projection of $9.70-$10.95.
For the fourth quarter of 2024, InterDigital estimates revenues to be between $239 million and $249 million. This includes an expectation of a record level of recurring revenues of about $118 million from existing agreements. Adjusted EBITDA is estimated in the band of $180-$190 million. Non-GAAP earnings are expected to be within $5.42-$5.70 per share.
Zacks Rank
InterDigital currently carries a Zacks Rank #4 (Sell).
Arista Networks Inc. (ANET - Free Report) is scheduled to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $2.08 per share, suggesting a growth of 13.7% from the year-ago reported figure.
Arista has a long-term earnings growth expectation of 17.2%. ANET delivered an average earnings surprise of 15% in the last four reported quarters.
Akamai Technologies, Inc. (AKAM - Free Report) is slated to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $1.59 per share, indicating a decline of 2.4% from the year-ago reported figure.
Akamai has a long-term earnings growth expectation of 7.1%. AKAM delivered an average earnings surprise of 4.7% in the last four reported quarters.
Pinterest, Inc. (PINS - Free Report) is set to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, implying a growth of 21.4% from the year-ago reported figure.
Pinterest has a long-term earnings growth expectation of 33%. PINS delivered an average earnings surprise of 20.9% in the last four reported quarters.
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InterDigital Surpasses Q3 Earnings Estimates Despite Soft Revenues
InterDigital, Inc. (IDCC - Free Report) reported strong third-quarter 2024 results, with the adjusted earnings and revenues surpassing the respective Zacks Consensus Estimates.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
The company generated higher revenues year over year, driven by solid licensing momentum and product innovation. IDCC is also advancing its leadership position in AI (artificial intelligence) applications for wireless and video technology.
Net Income
Quarterly net income decreased to $34.19 million or $1.14 per share from $47.94 million or $1.72 per share in the year-earlier quarter. The decline was attributable to top-line contraction.
Non-GAAP net income was $44.92 million or $1.63 per share, down from $57.68 million or $2.13 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 76 cents.
InterDigital, Inc. Price, Consensus and EPS Surprise
InterDigital, Inc. price-consensus-eps-surprise-chart | InterDigital, Inc. Quote
Revenues
Net sales in the quarter fell to $128.68 million from $140.11 million in the year-ago quarter. The year-over-year decline was induced by lower catch-up revenues in smartphone licensing programs during the quarter and the expiration of the Huawei agreement. The top line, however, beat the consensus estimate of $97 million.
In the third quarter, total recurring revenues were $98.6 million, down from $104.5 million in the year-ago quarter. Smartphone revenues decreased 16% year over year to $87.4 million. Net sales from CE, loT/Auto increased to $40.6 million from $35.4 million in the year-ago quarter. Total catch-up revenues were down to $30 million from $35.6 million.
Other Details
Adjusted EBITDA decreased to $64.8 million from $83.5 million in the year-ago quarter. Total operating expenses rose to $89.3 million from $86.4 million in the year-ago quarter. The increase in operating costs is attributed to higher licensing-related expenses. Operating income declined to $39.3 million from $53.6 million in the year-earlier quarter.
Cash Flow & Liquidity
In the third quarter, InterDigital generated $77.6 million in cash from operating activities compared with $310.6 million in the year-earlier quarter. As of Sept. 30, 2024, it had $813.2 million in cash, cash equivalents and short-term investments, with $74.4 million of long-term debt and other liabilities.
Guidance Up
For 2024, with solid traction across the business led by a recent license agreement with Oppo and a binding arbitration agreement with Lenovo, the company expects revenues in the range of $855-$865 million, up from $690-$740 million expected earlier. Adjusted EBITDA is forecasted at $533-$543 million, up from $378-$416 million estimated earlier. IDCC now expects non-GAAP earnings in the band of $14.69-$14.99, up from the prior projection of $9.70-$10.95.
For the fourth quarter of 2024, InterDigital estimates revenues to be between $239 million and $249 million. This includes an expectation of a record level of recurring revenues of about $118 million from existing agreements. Adjusted EBITDA is estimated in the band of $180-$190 million. Non-GAAP earnings are expected to be within $5.42-$5.70 per share.
Zacks Rank
InterDigital currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Arista Networks Inc. (ANET - Free Report) is scheduled to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $2.08 per share, suggesting a growth of 13.7% from the year-ago reported figure.
Arista has a long-term earnings growth expectation of 17.2%. ANET delivered an average earnings surprise of 15% in the last four reported quarters.
Akamai Technologies, Inc. (AKAM - Free Report) is slated to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $1.59 per share, indicating a decline of 2.4% from the year-ago reported figure.
Akamai has a long-term earnings growth expectation of 7.1%. AKAM delivered an average earnings surprise of 4.7% in the last four reported quarters.
Pinterest, Inc. (PINS - Free Report) is set to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, implying a growth of 21.4% from the year-ago reported figure.
Pinterest has a long-term earnings growth expectation of 33%. PINS delivered an average earnings surprise of 20.9% in the last four reported quarters.