InterDigital Revenue Tops Guidance, Hits Record ARR and Raises Dividend

InterDigital raised the midpoint of its 2026 revenue outlook again on Thursday after new license agreements pushed third-quarter results above the company's own guidance and lifted annualized recurring revenue to a record $629 million.

The wireless and video patent licensor now expects full-year revenue of $813 million to $819 million, according to the earnings release it filed with an 8-K on Thursday. InterDigital stressed that the outlook counts only revenue already under contract and excludes any new deals or enforcement results it may land in the fourth quarter, which it said would be additive.

Revenue up 17%

Third-quarter revenue rose 17% to $193.4 million from $164.7 million a year earlier, including $36.2 million of catch-up revenue, more than double the $17.7 million a year earlier. Net income climbed 19% to $80.2 million, and diluted EPS rose 21% to $2.34. Non-GAAP EPS increased 22% to $3.11.

Adjusted EBITDA jumped 25% to $131.3 million, with the margin widening to 68% from 64%.

"This was another excellent quarter, with double-digit growth in revenue and profitability and record annualized recurring revenue," President and CEO Liren Chen said in the release.

PCs and consumer electronics offset smartphones

The mix shifted away from phones. Smartphone licensing revenue fell 10% to $122.6 million, while the consumer electronics, IoT and auto program nearly doubled, up 97% to $55.7 million. Streaming and cloud services, a program that had no revenue a year earlier, contributed $15.0 million.

During the quarter, InterDigital reached an agreement with a top PC manufacturer, with final terms to be set by binding arbitration. The company said it has now licensed four of the world's top five PC makers. It also signed an IoT license with EV charging company KEBA.

On the legal front, InterDigital said Europe's Unified Patent Court awarded it two new injunctions against Disney, bringing its record to eight injunctions out of eight patent cases decided so far.

Dividend raised

InterDigital raised its quarterly cash dividend to 75 cents a share from 70 cents. Total capital return for the quarter was $121.2 million, including $18.7 million of share repurchases, dividends of $19.3 million and $83.2 million of debt reduction.

Fourth-quarter outlook

For the fourth quarter, the company guided to revenue of $154 million to $160 million, diluted EPS of $1.04 to $1.27 and non-GAAP EPS of $1.72 to $1.98. For the full year, it expects diluted EPS of $8.93 to $9.16, non-GAAP EPS of $11.99 to $12.25 and adjusted EBITDA of $507 million to $515 million.

The company also noted that its 3.50% convertible notes due 2027 are convertible during the fourth quarter. Of the $296.7 million principal outstanding at Sept. 30, holders have elected to convert $2.2 million, and InterDigital said no incremental shares will result from those conversions because of its hedging arrangements.

Sources

1. InterDigital Form 8-K with third-quarter 2026 earnings release (Exhibit 99.1), filed Oct. 29, 2026 (accession 0001405495-26-000076)

This article is for informational and educational purposes only and is not investment advice. It is not a recommendation to buy or sell any security.

Disclaimer: This article was generated by IDD’s autonomous newsroom using super intelligence.