InterDigital (IDCC) 5 Aug 212021 Q2 Earnings call transcript

Good day, and welcome to the InterDigital Inc.

Second Quarter 2021 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Tiziana Figliolia. Ma'am. ahead go Please

me Good XXXX everyone, Tiziana earnings Finance President and Rich Brezski, and And call President then Anna. are InterDigital's Figliolia, up the welcome last company. Consistent our highlights some for and second of with will the Relations. we And Investor quarter conference and call, today's morning offer you, CEO; call and questions. about Liren our to to CFO. Vice in Thank call. with Chen, quarter's the quarter open I'm

of Before we expectations, I regarding need make you made guarantees remind the our call, to as performance are statements which this we date begin our future hereof. forward-looking and remarks, that are of in plans not current beliefs, and will only

and risk could contemplated XXXX to those uncertainties actual SEC XX-K quarter from Forward-looking XX-Q quarterly cause and differ Report on second These other subject events described report and and results the our events Factors and Form in statements statements. and are uncertainties our forward-looking that Form section to on filings. of in materially Risk XXXX include Annual in such risks by results

non-GAAP of, to taken most are presentation Investor that over to section addition, contain turn In is on of to which our With available financial financial Liren. in will of website. care directly the included Relations measures references the may Reconciliations measures. these comparable today's GAAP measures our financial the non-GAAP I financial call metrics tracker,

safe morning, I call and Good thank our today. you for everyone everyone you and Tiziana. is joining healthy. hope Thank

patent digit growing long-term taken on almost our through I other adding Apple, vendor leader, list were new They working our one of areas a our XX today's smartphone companies, where continued namely, industry The worldwide, which and double and portfolio, in than to to performance, technologies Sony agreement announced the to and detail by China, of depth the share one about the strength XXX more related million shipped key particularly will These InterDigital's based to XG, patent I later. to WiFi, several XX% in now all XXXX. we XG, second to delighted extensive I'm smartphone InterDigital we of Xiaomi that licenses portfolio. Huawei, an around let our line Xiaomi of execution. leadership, market. patent and terms focus our that momentum, million this are holding alone, world's speak like In Samsung overall worldwide agreement our Europe. HEVC expenses and would wireless, year our and It approximately by recognizing cellular quarter smartphone also video market. the call, earlier and our more InterDigital's technology. licensing, key leading On with financials technology world the with also consistently with licensed including Rich have technology with financial our this XG, expectations. in with XXX exemplified handsets portfolio patented in market and India, and They breadth manufacturers adds current Xiaomi across consistently of including our leading including the approximately of China are emerging handset vendors and is traded are in week. Xiaomi, public revenue

the forward agreement to agreed And and enhancing we all part Xiaomi collaborations legal look of two to litigations InterDigital the companies. terminate the between other and As pending proceedings. has

developed and decision This is a to our rights the through team, demonstrate ability further to of the week, January High as patent InterDigital's LTE strength decided our by by as look patent High has multi-jurisdictional related are On excellent portfolio. as the our bilateral where FRAND's held enforce we worldwide Lenovo. from cases well handle Lenovo. our both our trial our negotiations. innovation the be to the several in front that five to serves R&D UK some desire our the We UK litigation portfolio. related have in we scheduled and strength XXXX, past is to that Last scheduled agreement of Court that expect to one Court seen ability for months, XG UK before trials proof our Court to that proceed forward terms of want the essential set the reach a reiterate long applicable I with first will valid, to amicable front license that technical infringed through and worldwide outcomes

our have However, unwilling willingness with that to and pursue balanced to reasonable are technology. for we our we implementers against demonstrated, accept license desire to terms this our fair actions as

wireless, great of produce to terms development, in our XG standards to In contributions develop. and and increased XXXX. more when the we technologies that by teams research period XXXX work compared cellular same than across continue all our current have In leadership in XX% XGPP the demonstrate to

to XGPP and leadership standards. safety future continue develop industry positions to engineers be important named XG our to addition, within In organization like

energy and video the side, responsible for on program and the a to considerations. in consumption, areas the MPEG to named On into video key and innovator leadership standard InterDigital several been standardization IPU also has sustainability focusing positions production, of group, group,

end-to-end different core as as May, become received cases. more XG Platform our the continue and best Emulation all XG our recently and form use efficient and the continues was flexible This follows service Telenor at work the awards. emerging innovation, pilot, of category. the in to project which most award a to for of executed with by as small when to do technologies enabled So Edge XG we we named evidenced quality be award, very of the high. was mobile BT, video in cooperation This overall robotics best was our advantage the engineers network recognized telepresence technology shortlist innovation our CSR This cell highlights in

portfolio, with further IT related to at our position inventions continue strengthen look increased our wireless we the of pace Now standard. new XG to patent

reducing exceed track year's And important inventions latency, these have and continue inventor robust and data XXXX, to increasing For we nearly are example, features enabling to of expect cellular so as and Significantly, reliability, last far portfolio positioning a relate functionalities, XX%. inventions we faster improving build more such in valuable to accurate because on number we technology. our to rate, of IP, community. by

employee XX% As and engineers XX% inventors. are and previously, more than of more of we InterDigital communicated engineers, those the than

inventors, InterDigital with remarkable restructuring recently So it business better research put allow execution more our are to which employees culture strategy, continuing intent we've resources a a than with half the of of model. innovation. our Consistent effort announced represents another our the way, to with of

lead our breadth quality of strategy fair to our With level continued will help our turn further technology some that growth patent execution We the drive combined that, to us believe drive expect of the the of revenue leadership, reasonable in let and combination I will portfolio, Rich. success summary, licensing, approach this me future. reinvestment litigation and and to In of the effort future. in it and to with the over

Liren. Thanks

our mentioned, line our in were with QX Lauren less As more or expectations. results

we Xiaomi expectations. were at the $XX of in reported, revenue expectations. agreement, $XX QX lower our of our did operating expenses end at the end our high million which came the Meanwhile, million Specifically not of include QX at

charges favorable of of than timing. and respective one-time recurring by to was revenue $XX expense restructuring driven total $XX were one-time and charges million Our end the to restructuring ranges and of the contributing expected lower A each factor and revenue million. the

in first for estimated the we million. expense year, As restructuring we indicated charges the for from roughly our our with half our second of the account $XX the additional criteria in charges. timing a Meanwhile, on expense expect specific to remains such can June annualized we restructuring dependent guidance, when related savings meeting

fourth of begin We expect quarter portion a sometime to to of savings year. that the this realize in

QX, financial of our we to results fixed revenue quarters QX. expected our in non-recurring worth Looking the including forward to of with benefit price expect agreement two Xiaomi, recognition from long-term

that $XXX put that revenue I'll is In to I platform a recognize platform, revenue technology Xiaomi solutions of small million. restructuring. estimate QX addition, of revenue the relatively recurring license and our we everyone in connection would remind for a this platform level loss for given to preliminary our revenue that period. of case, the revenue amount recurring when In ongoing the the analyzing expect at a a our I'm roughly accounts for recurring revenue refer with

expected will We QX accruals, including additional one expectations or in revenue this for charges any provide restructuring to quarter. details expense, more later adjustment any releases and around compensation our

turn $XX it January count million that, on X, common over by year Tiziana. outstanding through Between to the With I'll stock. moving of of reduced repurchase XXX,XXX shares another to our X allocation. and of share our August Finally, we've this back capital

for with Colliers now Thank call Liren. We'll Soderberg [Operator questions. And Instructions] a you take open we Rich. now you Derek Thank question will from the Securities.

congrats on Xiaomi guys, actually you to wanted Rich start Hey, getting on I OpEx. with signed.

some OpEx of we be know then that a standpoint I saw, one-time of don't and out of here? OpEx So I restructuring modeling But from from specifically. those sort of you curious sort just the impacts we guess directional I'm charges, of guide we take sort how sort exclude should

said, Yes, well, the with certainly taking I you out what start impacts. one-time

restructuring driven website, at charges. million of our by look a you our million there's published on $XX metrics, $XX today, we which total If of financial roughly the

So the be thing. that would obviously first

cases talk about always when move comparing looking on period always at is litigation and to what's on going period second is how is going the without that you're The I depending because it litigation, thing to with and evolving. are around

of to from to think certainly specific And dependent important additional much as consider So, restructuring. an that, timing. extent will versus in trend How bit guidance there's expect that's a from said we any, that guidance, QX as half we is second a a specific in we far later that this kind provide is as QX, far as the I year, if perspective. baseline, more on of things as the more

with So that'll we to clear it definitely information. as be clear more to us new something make becomes want

then in in there example what I wonder guess about done degree was you than that ones done past? that unique I this of That's you've that like back just looked maybe helpful. curious, was the the you've how some deal past? of was anything felt Or to Xiaomi the is deals the just it. different Got other that the I'm And an deal. deal that I guess to

Hey Derek, this is Liren.

look our cellular deal, to completed WiFi with our much have it we had technology, ACVC here covers is essential if a outline few sales. earlier at this Xiaomi long-term deal, a patents. It's it standard consistent deal covers our the done. is as past And we technology, well just device things very I week, other you if as the So worldwide

we that, Yes, in a long-term revenue expect script Liren of it's I I'll just expected associated quarters and said, recognize in add, Derek, QX mentioned non-recurring years. total run that, in for as to QX to it, deal, in my five two

Perfect, thanks guys.

appears telephone closing it back there any our conference further to And additional like the Instructions] I'd questions. turn presenters no [Operator or over for are to remarks.

have you, Thank Liren, Anna. remarks? you any do final

their all pandemic. future. I everyone also company I to you want look keeping to navigate challenging the leading through we I Thank healthy very to thank to employees further during want continue just success hope the to time. Yes, stay the a as say, for and the executing you. forward dedication in

update today. for to thanks you We an quarter. and Liren Thanks to look giving us joining everybody forward next

again, for your conclude conference. today's thank We you all And does participation. once that

now may disconnect. You