InterDigital’s licensing momentum drives 24% ARR growth and $15.31 non-GAAP EPS
InterDigital’s full-year 2025 annualized recurring revenue rose 24% to $582.4 million, supporting a record net income of $406.6 million and non-GAAP EPS of $15.31 on $834.0 million in revenue. Licensing included a record Samsung deal and new agreements with vivo, Honor and HP, while patents grew 14% to 38,000.
1. Fourth Quarter 2025 Financial Highlights
InterDigital reported Q4 revenue of $158.2 million, down 37% year-over-year, driven by a 91% decline in catch-up revenue to $12.6 million versus $135.8 million in Q4 2024. GAAP net income fell 68% to $43.0 million, or $1.20 diluted EPS, as operating expenses rose 22% to $110.4 million. On a non-GAAP basis, adjusted EBITDA was $88.2 million, down 55%, and non-GAAP EPS was $2.12, a 59% decline from $5.15 a year earlier. Annualized recurring revenue remained robust at $582.4 million, up 24% versus Q4 2024.
2. Full Year 2025 Record Performance
For the full year ended December 31, 2025, InterDigital delivered near-record total revenue of $834.0 million, a 4% decrease from 2024, while driving 13% growth in net income to $406.6 million and a 7% increase in adjusted EBITDA to $588.9 million. Non-GAAP EPS climbed 2% to $15.31. Free cash flow reached an all-time high of $473.9 million, and operating cash flow was $544.5 million. The company achieved net income margin of 49% and adjusted EBITDA margin of 71%, underscoring strong cost management and high-margin recurring licensing revenues.
3. Licensing Milestones and Portfolio Growth
InterDigital closed the most valuable license in its history with Samsung and signed new agreements with top-ten smartphone vendors Vivo and Honor, as well as HP. Smartphone licensing revenue hit a record $678.9 million, up 14% year-over-year. CE, IoT and automotive program revenue grew 60% to $154.6 million. The patent portfolio expanded by 14% to approximately 38,000 granted patents and applications. The company also secured injunctions against Disney’s video streaming services in Brazil and Germany and acquired video AI start-up Deep Render to bolster its research capabilities.
4. Guidance for 2026
InterDigital expects Q1 2026 revenue between $194 million and $200 million, with adjusted EBITDA of $101 million to $110 million and diluted EPS of $1.61 to $1.86. Full-year 2026 guidance projects revenue of $675 million to $775 million, adjusted EBITDA of $381 million to $477 million, and diluted EPS of $5.77 to $8.51. Non-GAAP EPS is forecast at $2.39 to $2.68 for Q1 and $8.74 to $11.84 for the full year, reflecting contributions from existing and anticipated new licensing agreements.