InterDigital (IDCC)
NASDAQInformation TechnologySoftware - ApplicationSnapshot 2026-09-09
$339.34-0.47%
Close 2026-09-09 · 1-day change
NASDAQInformation TechnologySoftware - ApplicationSnapshot 2026-09-09
Warn: Primary pillar under pressure — Revenue around $725M in FY26: FY26 revenue guidance $775M-$845M vs ~$725M target.
InterDigital has strong cash flow, improving from -$20M to $16M in operating cash. It raised dividends from $0.6 to $0.7 per share, showing good capital returns. The company secured key licensing deals with Amazon and won legal injunctions, strengthening its patent moat. Revenue guidance of about $725M for 2026 is stable despite recent challenges.
Revenue is expected to decline about 8% next year, and net income dropped from $116M to $75M recently. Legal risks from patent cases could hurt licensing revenue. The recent selloff and soft guidance show risks to growth and earnings.
The market prices in about -8% revenue growth and values the stock just 1% above our fair value near $276. Our view aligns with this cautious outlook given recent earnings and legal risks.
Breaks if: Dividend per share falls below $0.7 next year
Continue to increase the dividend per share as part of capital allocation strategy.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on annualized recurring revenue and licensing agreements. The current thesis state is intact, bolstered by recent earnings beats and consistent management priorities.
The market appears to price in a fragile valuation due to elevated expectations and weak execution quality. IDCC is seen as expensive compared to peers, with an expectations gap indicating that the market may not fully justify its current valuation.
Fundamentals are likely to remain stable, as management is on track with growth in annualized recurring revenue and profitability. However, there is a near-term risk of earnings misses, given the erratic performance of industry peers.
The thesis hinges on management's ability to maintain guidance and deliver on growth targets. Additionally, external factors such as potential Fed rate cuts and the performance of sector bellwethers will play a crucial role in shaping future outcomes.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports confidence in the company's growth. Additionally, significant growth in recurring revenue aligns with management's goals. There are no new threats impacting the thesis.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: Significant legal losses or licensing deal cancellations occur
Breaks if: Operating cash flow falls below $10M next year
Breaks if: Revenue falls below $675M in FY26
Over the next 1 to 3 years, IDCC's performance will depend on its execution and external market conditions. Not investment advice.