InterDigital, Inc. (IDCC) Business Profile

What it does

InterDigital researches and develops wireless, video and artificial intelligence technologies, then licenses its patented inventions to companies that use them. Its customers include makers of smartphones, computers, televisions, connected cars and other devices, as well as providers of cloud-based services. It was founded in 1972, is headquartered in Wilmington, Delaware, and is led by President and Chief Executive Officer Liren Chen.

The company’s wireless work covers cellular and Wi-Fi technology used to transmit voice, data and video. Its video work includes technology for encoding and decoding video, which makes it possible to store and deliver content across devices and networks. Its AI research focuses on applications in wireless and video, including video compression and wireless systems.

InterDigital contributes technology to industry standards: common technical specifications that help products and services work together. It seeks patents on its inventions and licenses the resulting rights to businesses whose products or services use them. The company also acquires patents and develops technology with partners.

As of December 31, 2025, its subsidiaries held more than 38,000 patents and patent applications. InterDigital believes some are, or may become, essential to existing or future industry standards. Its issued patents expire at different times, ranging from 2026 through 2045.

How it makes money

InterDigital earns revenue primarily by licensing its patented inventions. Its licensing programs cover smartphones, consumer electronics and connected devices, automotive products, and video services. A license can cover a portfolio of technologies used across a customer’s products, rather than a single invention.

Most revenue comes from fixed-fee agreements; a smaller portion comes from variable royalties, generally tied to licensed products. Some agreements combine fixed fees and variable payments when unit caps are exceeded. In 2025, fixed-fee agreements accounted for 93% of revenue. New agreements can also include catch-up revenue for previously unlicensed sales made before the agreement was signed.

InterDigital licenses some patents directly and others through joint programs. It acts as exclusive licensing agent for a program with Sony that combines patents for digital televisions and computer monitors. It also participates in Avanci, a platform that offers cellular patent licenses for connected products, particularly vehicles.

Total revenue was $834.0 million in 2025 and $193.4 million in the third quarter of 2026. The 2025 total included $277.4 million of catch-up revenue; the third-quarter total included $36.2 million of catch-up revenue.

InterDigital had no video-services revenue in 2025. In 2026, it agreed to a patent license with Amazon covering devices and services, with final terms to be decided through binding arbitration. Streaming and cloud services contributed $15 million of revenue in the third quarter of 2026. The company also began recognizing revenue from a new PC license based on an estimate, while its value awaits arbitration.

Customers and how it sells

InterDigital licenses its technology to manufacturers of smartphones and other wireless devices, consumer electronics, connected vehicles and internet-of-things products. It also pursues video streaming and cloud-service providers. Customers named by the company include Samsung, Apple, vivo, Honor and HP.

Revenue is concentrated among a limited number of licensees. Samsung, Apple and vivo each accounted for 10% or more of consolidated revenue in 2025. Samsung’s main patent license runs through December 31, 2030; Apple’s agreement extends through September 30, 2029; and vivo’s agreement runs through June 30, 2028. A separate Samsung TV and monitor agreement expired at the end of 2025.

InterDigital licenses globally through direct agreements and platforms. At the end of 2025, it had approximately 85% of the global smartphone market under license. After a new PC agreement in the third quarter of 2026, it had 70% of the PC market under license, including four of the top five PC makers.

The company is based in Delaware and conducts research primarily in the United States, Canada, the United Kingdom and France. It also has offices in other locations, including Belgium, Finland and China.

Suppliers and costs

InterDigital’s business centers on research, patent development, licensing and enforcement. Its research teams use specialized engineering staff, equipment and software platforms; its costs also include maintaining patents and negotiating or enforcing licenses. The company supplements internal development with joint projects and selected acquisitions of patents and businesses.

Research and portfolio development costs were $211.4 million in 2025. Personnel was the largest portion of that expense. InterDigital had approximately 460 employees as of December 31, 2025, including approximately 240 based outside the United States.

Intellectual property enforcement costs were $48.9 million in 2025, out of total licensing costs of $93.6 million. The company says enforcement costs vary with activity and are likely to remain a significant expense. Litigation can also require substantial outside legal fees and employee time. InterDigital does not identify a key or sole-source supplier in its business description.

Competitive position

InterDigital competes in technology development with wireless and video technology companies, device and semiconductor companies, wireless operators, and streaming and cloud providers. They develop technologies that may compete with InterDigital’s inventions commercially or in the standards-setting process. The company does not name a specific competitor in that description.

Patent licensing works differently from a conventional product market: a device or service may need licenses from several patent holders. InterDigital nevertheless competes with other patent holders for a share of the royalties a manufacturer is willing or able to pay. Licensees may argue for limits on total royalties, and alternative or royalty-free technologies can compete with proprietary standards.

The company’s portfolio covers cellular, Wi-Fi and video technologies, and it participates in the organizations that establish industry standards. Its research and patents have been built internally and through partnerships and acquisitions. It also has licensing relationships across much of the global smartphone and PC markets.

Our reading: The patent portfolio and standards participation provide a meaningful source of protection because licensees may need rights to inventions used in compliant products. Our reading: That protection has limits: individual patents can be challenged, and competing technologies or pressure on aggregate royalties can constrain licensing.

Growth opportunities

InterDigital plans to grow licensing revenue by signing additional device makers, expanding into video streaming and other cloud services, and pursuing new product markets. It also intends to invest in wireless, video and AI research, contribute to standards and develop technology with partners.

The company estimates that the video-services market will grow from approximately $475 billion of annual revenue in 2025 to approximately $675 billion of annual revenue by 2029. It expects global cellular internet-of-things device shipments to grow from approximately 550 million in 2025 to approximately 800 million by 2029. These are market estimates, not InterDigital revenue targets.

The Amazon agreement extends InterDigital’s licensing into devices and services, although its final terms are subject to arbitration. The company also signed a license covering KEBA’s electric-vehicle chargers and agreed to a license with a PC manufacturer whose final terms will be determined through arbitration.

In video, InterDigital is developing technology for newer standards, including VVC, a video coding standard. It says Qualcomm and MediaTek have implemented VVC hardware decoding in smartphone chipsets, while Google has added VVC support to Android. InterDigital expects broad adoption across the ecosystem to take multiple years and iterations.

Structural risks

• License negotiations and renewals: Negotiations can be lengthy and expensive, and some prospective licensees may delay taking a license. Failure to renew agreements on acceptable terms can create periods when InterDigital cannot recognize revenue from a customer.
• Customer concentration: A limited number of licensees generate a significant portion of revenue. A failed renewal, missed payment or reduced shipments under a per-unit license could affect revenue and cash flow.
• Litigation and arbitration: Enforcing patents and defending licensing practices can require significant legal spending and employee time. Courts or arbitrators may set royalties or other terms that are less favorable than InterDigital seeks.
• Patent and technology challenges: Third parties can challenge patent validity, essentiality or infringement, or design around patents. New inventions may not be patented, adopted into standards or deployed widely enough to produce revenue.
• Expansion and geopolitics: Video and cloud licensing is less developed than device licensing, and providers may delay negotiations or use alternatives. China is a key market, where trade tensions and economic conditions could affect new agreements and renewals.

Bottom line

Our reading

Our reading: InterDigital is a research and patent-licensing business whose economics depend on turning inventions into enforceable rights and long-term customer agreements. Its established device licenses support the model, while streaming and cloud services offer another licensing market with terms still being tested. Customer concentration, patent challenges and the cost and uncertainty of enforcement remain central exposures.