IDCC Q4 Earnings Fall Short of Estimates Despite Solid Revenue Growth

InterDigital, Inc. IDCC reported mixed fourth-quarter 2024 results, with the top line beating the Zacks Consensus Estimate but the bottom line missing the same. 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.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Net IncomeQuarterly net income increased to $133.1 million or $4.09 per share from $39.1 million or $1.41 per share in the year-earlier quarter. The increase was attributable to top-line expansion.Non-GAAP net income was $150.6 million or $5.15 per share, up from $37.5 million or $1.41 per share in the year-ago quarter. The bottom line missed the Zacks Consensus Estimate of $5.40.In 2024, the company reported GAAP net income of $358.6 million or $12.07 per share, up from $214.1 million or $7.62 per share in the year-ago quarter. Non-GAAP net income improved to $408.9 million or $14.97 per share up from $254.4 million or $9.23 per share in 2023.InterDigital, Inc. Price, Consensus and EPS Surprise InterDigital, Inc. price-consensus-eps-surprise-chart | InterDigital, Inc. QuoteRevenuesNet sales in the quarter rose to $252.8 million from $105.5 million in the year-ago quarter. The year-over-year improvement was induced by higher catch-up revenues in smartphone licensing programs during the quarter. The top line beat the consensus estimate of $244 million.In 2024, the company generated $868.5 million in revenues up 58% year over year.In the fourth quarter, Smartphone revenues increased 162% year over year to $230.6 million. Growth was primarily driven by catch-up revenues from new agreements signed with the world’s major device makers in 2024. Revenues from CE, IoT/Auto group improved to $21.8 million from $17 million in the prior year quarter.Total recurring revenues were $117 million, up 13% year over year. Revenue missed our estimate of $151.1 million. Total catch-up revenues are reported at $135.8 million, up from $2.2 million in the prior year quarter. Catch-up revenues beat our estimate of $92.2 million.Other DetailsAdjusted EBITDA rose to $198.1 million from $53.3 million in the year-ago quarter. Total operating expenses rose to $90.3 million from $80.2 million in the year-ago quarter. The increase in operating costs is attributed to higher research, portfolio development, and general and administrative expenses. Operating income increased to $162.5 million from $25.3 million in the year-earlier quarter.Cash Flow & LiquidityIn the fourth quarter, InterDigital generated $192.03 million in cash from operating activities against a cash utilization of $23.6 million in the year-earlier quarter. In 2024 the company generated $271.5 million in cash from operations compared with $213.7 million in 2023.As of Dec. 31, 2024, it had $958.2 million in cash, cash equivalents and short-term investments, with $70.4 million of long-term debt and other liabilities compared with respective tallies of $1 billion and $84.3 million in 2023.GuidanceFor 2025, the company expects revenues in the range of $660-$760 million, while adjusted EBITDA is forecasted at $400-$495 million. IDCC expects non-GAAP earnings in the band of $9.69-$12.92.For the first quarter of 2025, InterDigital estimates revenues to be between $112 million and $116 million. Adjusted EBITDA is estimated in the band of $53-$60 million. Non-GAAP earnings are expected to be within $1.19-$1.42 per share.IDCC’ Zacks Rank & Other Stocks to ConsiderInterDigital currently carries a Zacks Rank #2 (Buy).Here are some other top-ranked stocks that investors may consider.Keysight Technologies, Inc. KEYS has a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.In the last reported quarter, it delivered an earnings surprise of 5.10%. Keysight is expected to benefit from the growing proliferation of electronic content in vehicles, momentum in space and satellite applications and rising adoption of driver-assistance systems globally.Arista Networks, Inc. ANET sports a Zacks Rank #1 at present. In the last reported quarter, it delivered an earnings surprise of 14.77%.It is engaged in providing cloud networking solutions for data centers and cloud computing environments. The company offers 10/25/40/50/100 Gigabit Ethernet switches and routers optimized for next-generation data center networks.Zillow Group, Inc. ZG carries a Zacks Rank #2 at present. In the last reported quarter, it delivered an earnings surprise of 9.38%. ZG delivered an earnings surprise of 25.47%, on average, in the trailing four quarters. The company is witnessing solid momentum in rental revenues, driven by growth in multi and single-family listings, which is a positive factor.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report InterDigital, Inc. (IDCC): Free Stock Analysis Report Arista Networks, Inc. (ANET): Free Stock Analysis Report Keysight Technologies Inc. (KEYS): Free Stock Analysis Report Zillow Group, Inc. (ZG): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks