WILMINGTON, DE — InterDigital Inc. (Nasdaq: IDCC) raised its full-year 2026 revenue outlook after signing its first licensing agreement covering streaming and cloud services, helping drive record annualized recurring revenue despite lower quarterly revenue and earnings.
The wireless, video and artificial intelligence technology licensing company increased its 2026 revenue guidance to a range of $775 million to $845 million, up from its previous outlook of $675 million to $775 million. The revised forecast reflects expected contributions from existing licenses as well as anticipated new agreements and enforcement actions during the remainder of the year.
Second-quarter revenue declined 13% to $260.2 million from $300.6 million a year earlier, primarily because catch-up licensing revenue fell to $103.7 million from $162.3 million. Net income decreased 36% to $116.4 million, or $3.40 per diluted share, while operating expenses rose 27% to $120.9 million, driven largely by higher intellectual property enforcement costs and share-based compensation.
The company reported annualized recurring revenue of $625.7 million, a 13% increase from a year earlier and the highest level in its history. The gain was supported by a new agreement with Amazon covering the company’s services and devices, including Amazon Prime Video, with final licensing terms to be determined through binding arbitration.
InterDigital also signed a new Internet of Things licensing agreement with a fintech company covering point-of-sale devices and secured two injunctions against Disney through Europe’s Unified Patent Court spanning 11 countries.
“We have delivered another outstanding quarter, with continued momentum across our business, including our new agreement with Amazon, driving annualized recurring revenue to a record $626 million,” Chief Executive Officer Liren Chen said. He added that the company increased its full-year outlook based on second-quarter results, business momentum and expectations for additional progress during the remainder of 2026.
By business segment, smartphone licensing revenue fell 48% year over year to $122.7 million, while consumer electronics and IoT/automotive revenue declined 58% to $27.5 million. Streaming and cloud services contributed $110 million during the quarter following the new licensing agreement.
InterDigital ended the quarter with $1.11 billion in cash, cash equivalents and short-term investments, compared with $1.24 billion at the end of 2025. The company generated $82.5 million in operating cash flow during the quarter, repurchased approximately $23 million of its common stock and declared a quarterly dividend of $0.70 per share.
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