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InterDigital, Inc. (IDCC - Free Report) reported strong second-quarter 2024 results, beating the top-line and bottom-line estimates and well exceeding its guided range. 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 applications for wireless and video technology.
Net Income
Quarterly net income was $109.66 million or $3.93 per share, up from $21.8 million or 79 cents per share in the year-earlier quarter. The growth is primarily attributed to year-over-year top-line expansion.
Non-GAAP net income was $118.9 million or $4.57 per share, up from $35.63 million or $1.30 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 74 cents.
InterDigital, Inc. Price, Consensus and EPS Surprise
Net sales in the quarter rose to $223.5 million from $101.6 million in the year-ago quarter. The 120% year-over-year improvement was induced by solid growth of catch-up revenues in smartphone licensing programs during the quarter. The top line beat the consensus estimate of $96 million.
In the second quarter, total recurring revenues were $95.9 million, down from $99.1 million in the year-ago quarter. Net sales beat our estimate of $89.4 million. Smartphone revenues increased 125% year over year to $199.2 million. Net sales from CE, loT/Auto increased to $23.7 million from $12.4 million in the year-ago quarter. Total catch-up revenues improved to $127.6 million from $2.5 million a year ago.
Other Details
Adjusted EBITDA increased to $157.7 million from $53.6 million in the year-ago quarter. Total operating expenses rose to $89.6 million from $78.2 million in the year-ago quarter. The increase in operating costs is primarily attributed to higher licensing-related expenses. Operating income improved to $133.9 million from $23.4 million in the year-earlier quarter.
Cash Flow & Liquidity
In the second quarter, InterDigital utilized $48.9 million of cash in operations compared with a cash utilization of $45.4 million in the year-earlier quarter. As of Jun 31, 2024, it had $760.3 million in cash, cash equivalents and short-term investments, with $73.9 million of long-term debt and other long-term liabilities.
Guidance Up
For 2024, with solid traction across the business, the company presently expects revenues in the range of $690-$740 million, up from $620-$670 million expected earlier. Adjusted EBITDA is forecasted at $378-$416 million, up from $310-$345 million estimated earlier. IDCC now expects non-GAAP earnings in the band of $9.70-$10.95, up from the prior projection of $7.45-$8.76.
For the third quarter of 2024, InterDigital estimates revenues to be between $94 million and $98 million. Adjusted EBITDA is expected in the band of $36-$39 million. Non-GAAP earnings are expected to be within 70-80 cents per share.
Zacks Rank & Stocks to Consider
InterDigital currently has a Zacks Rank #4 (Sell).
TDS is a diversified telecom service provider offering wireless and wireline services in the United States. It is witnessing strong revenue growth in the TDS Telecom segment, backed by significant fiber broadband investment made in the past couple of years. The company is actively increasing the portion of fiber networks across its service address mix to deliver high-speed Internet without any signal disruption.
Motorola Solutions Inc. (MSI - Free Report) provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure services. Motorola carries a Zacks Rank #2 (Buy) at present.
It delivered a trailing four-quarter average earnings surprise of 7.54% and has a long-term growth expectation of 9.47%. In the last reported quarter, Motorola delivered an earnings surprise of 11.51%.
Corning Incorporated (GLW - Free Report) , carrying a Zacks Rank #2 at present, delivered a trailing four-quarter earnings surprise of 2.17% in the last reported quarter.
Corning’s focus on innovation is driving demand across its segments and giving it pricing power. It is benefiting from solid traction in its premium smartphone cover materials and semiconductor-related products, and price hikes are contributing to growth in the display business.
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InterDigital (IDCC) Q2 Earnings Beat Estimates, Guidance Raised
InterDigital, Inc. (IDCC - Free Report) reported strong second-quarter 2024 results, beating the top-line and bottom-line estimates and well exceeding its guided range. 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 applications for wireless and video technology.
Net Income
Quarterly net income was $109.66 million or $3.93 per share, up from $21.8 million or 79 cents per share in the year-earlier quarter. The growth is primarily attributed to year-over-year top-line expansion.
Non-GAAP net income was $118.9 million or $4.57 per share, up from $35.63 million or $1.30 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 74 cents.
InterDigital, Inc. Price, Consensus and EPS Surprise
InterDigital, Inc. price-consensus-eps-surprise-chart | InterDigital, Inc. Quote
Revenues
Net sales in the quarter rose to $223.5 million from $101.6 million in the year-ago quarter. The 120% year-over-year improvement was induced by solid growth of catch-up revenues in smartphone licensing programs during the quarter. The top line beat the consensus estimate of $96 million.
In the second quarter, total recurring revenues were $95.9 million, down from $99.1 million in the year-ago quarter. Net sales beat our estimate of $89.4 million. Smartphone revenues increased 125% year over year to $199.2 million. Net sales from CE, loT/Auto increased to $23.7 million from $12.4 million in the year-ago quarter. Total catch-up revenues improved to $127.6 million from $2.5 million a year ago.
Other Details
Adjusted EBITDA increased to $157.7 million from $53.6 million in the year-ago quarter. Total operating expenses rose to $89.6 million from $78.2 million in the year-ago quarter. The increase in operating costs is primarily attributed to higher licensing-related expenses. Operating income improved to $133.9 million from $23.4 million in the year-earlier quarter.
Cash Flow & Liquidity
In the second quarter, InterDigital utilized $48.9 million of cash in operations compared with a cash utilization of $45.4 million in the year-earlier quarter. As of Jun 31, 2024, it had $760.3 million in cash, cash equivalents and short-term investments, with $73.9 million of long-term debt and other long-term liabilities.
Guidance Up
For 2024, with solid traction across the business, the company presently expects revenues in the range of $690-$740 million, up from $620-$670 million expected earlier. Adjusted EBITDA is forecasted at $378-$416 million, up from $310-$345 million estimated earlier. IDCC now expects non-GAAP earnings in the band of $9.70-$10.95, up from the prior projection of $7.45-$8.76.
For the third quarter of 2024, InterDigital estimates revenues to be between $94 million and $98 million. Adjusted EBITDA is expected in the band of $36-$39 million. Non-GAAP earnings are expected to be within 70-80 cents per share.
Zacks Rank & Stocks to Consider
InterDigital currently has a Zacks Rank #4 (Sell).
Telephone and Data Systems, Inc. (TDS - Free Report) sports a Zacks Rank #1 (Strong Buy) at present. In the last reported quarter, it delivered an earnings surprise of 145.45%. You can see the complete list of today’s Zacks #1 Rank stocks here.
TDS is a diversified telecom service provider offering wireless and wireline services in the United States. It is witnessing strong revenue growth in the TDS Telecom segment, backed by significant fiber broadband investment made in the past couple of years. The company is actively increasing the portion of fiber networks across its service address mix to deliver high-speed Internet without any signal disruption.
Motorola Solutions Inc. (MSI - Free Report) provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure services. Motorola carries a Zacks Rank #2 (Buy) at present.
It delivered a trailing four-quarter average earnings surprise of 7.54% and has a long-term growth expectation of 9.47%. In the last reported quarter, Motorola delivered an earnings surprise of 11.51%.
Corning Incorporated (GLW - Free Report) , carrying a Zacks Rank #2 at present, delivered a trailing four-quarter earnings surprise of 2.17% in the last reported quarter.
Corning’s focus on innovation is driving demand across its segments and giving it pricing power. It is benefiting from solid traction in its premium smartphone cover materials and semiconductor-related products, and price hikes are contributing to growth in the display business.