Interdigital (IDCC)
NASDAQ:IDCC
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InterDigital
(NASDAQ:IDCC)
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Rating:74Outperform
Price Target:
$352.00
▼(-0.08% Downside)
Action:UpgradedDate:02/06/26
The score is driven primarily by strong financial performance (high profitability, robust cash generation, and improving leverage). Technicals are supportive with the stock trading above key moving averages and positive MACD. Offsetting these positives are a mid-level valuation (P/E ~26.6 with a low dividend yield) and earnings-call risks tied to 2026 guidance stepping down from 2025, renewal timing, and higher litigation costs.
Positive Factors
Cash generation
Consistently strong operating and free cash flow gives InterDigital durable funding for R&D, enforcement, and strategic M&A without relying heavily on new debt. High cash conversion supports reinvestment and shareholder returns even amid revenue timing swings.
Negative Factors
Guidance step‑down
Management's 2026 outlook implies lower revenue and EPS absent new agreements or arbitration wins, signalling structural sensitivity to timing of license renewals and deal flow. Prolonged gap could pressure investment plans and test the durability of margins and cash generation.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Consistently strong operating and free cash flow gives InterDigital durable funding for R&D, enforcement, and strategic M&A without relying heavily on new debt. High cash conversion supports reinvestment and shareholder returns even amid revenue timing swings.
Read all positive factors
InterDigital (IDCC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.05B
Dividend Yield0.66%
Average Volume (3M)489.89K
Price to Earnings (P/E)20.2
Beta (1Y)0.81
Revenue Growth28.75%
EPS Growth85.06%
CountryUS
Employees430
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)1.20
Shares Outstanding25,686,766
10 Day Avg. Volume308,227
30 Day Avg. Volume489,886
Financial Highlights & Ratios
PEG Ratio1.78
Price to Book (P/B)7.46
Price to Sales (P/S)9.85
P/FCF Ratio15.54
Enterprise Value/Market Cap0.98
Enterprise Value/Revenue10.58
Enterprise Value/Gross Profit12.08
Enterprise Value/Ebitda15.06
Forecast
1Y Price Target
$425.00Price Target Upside20.65% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)7.16
Revenue Forecast (FY)$704.70M
InterDigital Business Overview & Revenue Model
Company Description
InterDigital, Inc., together with its subsidiaries, designs and develops technologies that enable and enhance wireless communications in the United States, China, South Korea, Japan, Taiwan, and Europe. It provides technology solutions for use in ...
How the Company Makes Money
InterDigital primarily makes money by licensing its intellectual property (IP), especially patents that are used in standardized technologies for wireless communications and related areas. Its main revenue stream is patent licensing: device makers...
InterDigital Key Performance Indicators (KPIs)
InterDigital Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial momentum highlighted by record 2025 financials, substantial ARR growth (+24% YoY), expanded licensing across smartphones and CE, a growing high-quality patent portfolio (+14% YoY), and strategic AI capabilities (DeepRender acquisition). However, the company faces near-term headwinds from expirations that temporarily reduced ARR, elevated litigation costs and ongoing multi-jurisdictional enforcement risks, and a 2026 guidance range that is below 2025 results absent additional new deals or arbitration outcomes. On balance, the positives around record performance, recurring revenue growth, robust cash generation, and a deep pipeline and IP position outweigh the short-term risks tied to timing of renewals, litigation costs, and conservative near-term guidance.Positive Updates
Record Full-Year Financials
Full-year 2025 revenue of $834 million (second-highest in company history); adjusted EBITDA of $589 million (record high); non-GAAP EPS of $15.31 (record high). Over four years (2021–2025) revenue roughly doubled, adjusted EBITDA nearly tripled, and non-GAAP EPS increased more than fourfold.
Negative Updates
Guidance Below 2025 Levels
2026 full-year guidance of $675 million to $775 million revenue implies a decline from 2025's $834 million; guided non-GAAP EPS of $8.74 to $11.84 is below 2025's $15.31, indicating expected step-down absent new agreements/arbitration outcomes.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Full-Year Financials
Full-year 2025 revenue of $834 million (second-highest in company history); adjusted EBITDA of $589 million (record high); non-GAAP EPS of $15.31 (record high). Over four years (2021–2025) revenue roughly doubled, adjusted EBITDA nearly tripled, and non-GAAP EPS increased more than fourfold.
Read all positive updates
Company Guidance
Management guided 2026 total revenue of $675–$775 million, adjusted EBITDA of $381–$477 million, and non‑GAAP diluted EPS of $8.74–$11.84; for Q1 2026 they expect $194–$200 million of revenue from existing contracts (including $55–$60 million of catch‑up), a 52%–55% adjusted EBITDA margin on those contracts, and non‑GAAP diluted EPS of $2.39–$2.68. Management noted Q1 guidance excludes impacts from any new agreements or arbitration results (while the full‑year guide does include potential contributions from such outcomes), said roughly two‑thirds of the ~$92 million of ARR expirations at year‑end 2025 have been renewed, flagged higher litigation and R&D investment costs factored into the 2026 outlook, and reiterated the ARR growth trajectory toward $1 billion by 2030 from the current ARR of $582 million.InterDigital Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
81
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 834.01M | 868.52M | 549.59M | 457.79M | 425.41M |
| Gross Profit | 669.67M | 699.28M | 470.19M | 386.38M | 360.78M |
| EBITDA | 586.19M | 544.75M | 357.22M | 225.63M | 160.97M |
| Net Income | 406.64M | 358.61M | 214.07M | 93.69M | 55.30M |
Balance Sheet | |||||
| Total Assets | 2.06B | 1.84B | 1.77B | 1.90B | 1.63B |
| Cash, Cash Equivalents and Short-Term Investments | 1.24B | 958.21M | 1.01B | 1.20B | 941.63M |
| Total Debt | 505.84M | 490.94M | 625.16M | 626.99M | 444.37M |
| Total Liabilities | 963.17M | 978.31M | 1.19B | 1.17B | 875.24M |
| Stockholders Equity | 1.10B | 857.22M | 581.55M | 724.89M | 745.24M |
Cash Flow | |||||
| Free Cash Flow | 528.56M | 265.68M | 169.11M | 243.29M | 90.84M |
| Operating Cash Flow | 544.45M | 271.53M | 213.73M | 286.04M | 129.12M |
| Investing Cash Flow | -140.28M | 109.45M | -85.17M | -314.71M | -36.91M |
| Financing Cash Flow | -201.45M | -272.39M | -388.76M | 18.60M | -74.47M |
InterDigital Technical Analysis
Positive
352.27
Price Trends
344.45
Positive
338.65
Positive
318.36
Positive
Market Momentum
-3.35
Negative
60.34
Neutral
90.28
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IDCC, the sentiment is Positive. The current price of 352.27 is above the 20-day moving average (MA) of 325.40, above the 50-day MA of 344.45, and above the 200-day MA of 318.36, indicating a bullish trend. The MACD of -3.35 indicates Negative momentum. The RSI at 60.34 is Neutral, neither overbought nor oversold. The STOCH value of 90.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IDCC.
InterDigital Risk Analysis
InterDigital disclosed 36 risk factors in its most recent earnings report. InterDigital reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
InterDigital Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $6.27B | 11.53 | 16.44% | ― | 9.46% | 34.09% | |
74 Outperform | $9.05B | 20.20 | 38.50% | 0.66% | 28.75% | 85.06% | |
71 Outperform | $6.66B | 25.92 | 60.07% | 0.16% | 17.00% | 120.21% | |
70 Outperform | $4.82B | 63.09 | 10.31% | ― | 18.99% | 66.43% | |
63 Neutral | $4.48B | 224.68 | -9.44% | ― | 16.98% | -265.85% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $3.91B | 77.74 | 31.15% | ― | 22.02% | -55.25% |
* Technology Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.