InterDigital's consensus price target was raised from $283.67 to $323.75, driven by a major new licensing deal, increased recurring revenues, an improved revenue outlook, and expanding partnership opportunities.
Analyst Commentary
- Signed a new multiyear license agreement with a major Chinese smartphone vendor, resulting in stronger recurring revenue streams.
- Management raised third-quarter revenue outlook by 14%, supported by $11M in catch-up revenue from the new deal.
- Annualized recurring revenue (ARR) increased by $26M to approximately $580M, enhancing long-term earnings visibility.
- Bullish analysts see further upside from potential and expanding partnerships in the smartphone and consumer electronics markets.
- Growing licensing opportunities with streaming video platforms present additional medium-term growth catalysts.
What's in the News
- InterDigital raised Q3 2025 earnings guidance, projecting revenue of $155–$159 million (up from $136–$140 million) and diluted EPS of $1.39–$1.56 (up from $0.94–$1.11).
- The Board increased the quarterly dividend from $0.60 to $0.70 per share, effective Q4 2025.
- InterDigital to showcase Versatile Video Coding (VVC)-based innovations for enhanced streaming quality at IBC 2025.
- Company repurchased 192,968 shares for $41.6 million, completing 55.78% of the $1.19 billion buyback program since 2014.
- Arbitration with Samsung concluded with a new patent license agreement covering cellular wireless and video technologies.
Valuation Changes
Summary of Valuation Changes for InterDigital
- The Consensus Analyst Price Target has significantly risen from $283.67 to $323.75.
- The Future P/E for InterDigital has risen from 55.00x to 59.73x.
- The Net Profit Margin for InterDigital has risen slightly from 27.76% to 29.14%.
Disclaimer
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