WILMINGTON, Del., Feb. 18, 2016 (GLOBE NEWSWIRE) -- InterDigital, Inc. (NASDAQ:IDCC), a mobile technology research and development company, today announced results for the fourth quarter and full year ended December 31, 2015.

Fourth Quarter 2015 Financial Highlights

• Fourth quarter 2015 recurring revenue was $92.6 million, consisting of current patent royalties and current technology solutions revenue, representing an increase of 9% compared to recurring revenue of $85.1 million in fourth quarter 2014.  This increase in recurring revenue was primarily attributable to a 21% increase in per-unit royalties.
  
  
• Total revenue was $112.1 million, compared to $86.1 million in fourth quarter 2014.  Fourth quarter 2015 total revenue included $19.5 million of past sales, consisting of past patent royalties and past technology solutions revenue.
  
  
• Fourth quarter 2015 operating expenses were $58.8 million, compared to $60.8 million in fourth quarter 2014.  Intellectual property enforcement and non-patent litigation expenses were $5.1 million, a 65% decrease compared to $14.5 million in fourth quarter 2014.
  
  
• Net income¹ was $33.0 million, or $0.92 per diluted share, compared to net income of $13.8 million, or $0.36 per diluted share, in fourth quarter 2014.

Full Year 2015 Financial Highlights

• Recurring revenue was $372.8 million in 2015, representing an increase of 29% compared to $288.8 million in 2014.  The increase was primarily attributable to a 49% increase in per-unit royalties as well as an increase in fixed-fee royalties associated with a full year of revenue from new patent license agreements entered into during 2014.
  
  
• Total revenue was $441.4 million in 2015 compared to $415.8 million in 2014. The increase reflected higher recurring revenue in 2015 offset by a decrease in past sales from $125.0 million in 2014 to $68.7 million in 2015.
  
  
• 2015 operating expenses were $232.9 million, compared to $246.9 million in 2014.  Intellectual property enforcement and non-patent litigation expenses were $32.7 million, a 37% decrease compared to $52.3 million in 2014.
  
  
• Net income was $119.2 million, or $3.27 per diluted share, compared to net income of $104.3 million, or $2.62 per diluted share, in 2014.

"2015 was a very strong year financially and represented continued progress towards our goals, both in terms of driving recurring revenue and carefully managing expenses," said William J. Merritt, President and CEO of InterDigital. "In 2016, building on our foundation of world-class research and mobile industry contributions, we'll continue to focus on broadening our wireless customer base while working to penetrate new markets in IoT and connected technologies."

Additional Financial Highlights for Fourth Quarter 2015

• The slight decrease in fourth quarter 2015 operating expenses compared to fourth quarter 2014 was primarily driven by a $9.4 million decrease in intellectual property enforcement partially offset by a $7.3 million charge in fourth quarter 2015 primarily to increase accrual rates for performance-based compensation plans.
  
  
• In fourth quarter 2015, the company had free cash flow² of $79.2 million.  This compares to $43.5 million of free cash flow in fourth quarter 2014, primarily due to increased cash receipts from per-unit licensees, and a new patent license agreement signed during third quarter 2015. Ending cash and short-term investments totaled $933.7 million, $230 million of which is reserved for the repayment of the company's 2.50% Senior Convertible Notes maturing on March 15, 2016.
  
  
• During fourth quarter 2015, the company repurchased 0.1 million shares of common stock for $7.4 million.  From January 1, 2016 through February 17, 2016, the company repurchased an additional 0.6 million shares at a cost of $24.7 million, bringing the total repurchased under the company's current $400 million stock repurchase program to 5.9 million shares at a cost of $273.7 million. As of today, the company has repurchased more than half the shares of the company's common stock that were ever outstanding.
  
  
• The company's fourth quarter 2015 effective tax rate was approximately 31.1% as compared to 35.8% during fourth quarter 2014, based on the statutory federal tax rate net of discrete federal and state taxes. 

Additional Financial Highlights for Full Year 2015

• The $14.0 million decrease in operating expenses was primarily attributable to the $19.6 million decrease in intellectual property enforcement and non-patent litigation. The decrease was also partially attributable to a $4.2 million decrease in performance-based compensation, driven by charges to increase related accrual rates in 2014.  These and other decreases were partially offset by a $5.7 million increase in depreciation and amortization driven by the growth of our patent portfolio, as well as a $6.9 million increase in commercial initiatives expense.
  
  
• In 2015, the company generated $81.0 million of free cash flow compared to $203.0 million in 2014. The decrease in the company's free cash flow was primarily attributable to cash payments received in 2014 attributable to the new license agreements entered into during second quarter 2014.
  
  
• During 2015, the company repurchased 1.8 million shares of common stock for $96.4 million.
  
  
• The company's 2015 effective tax rate was approximately 35.7% as compared to 33.9% during 2014, based on the statutory federal tax rate net of discrete federal and state taxes.  The increase in the effective tax rate from 2014 to 2015 resulted primarily from the 2014 net benefit received from research and development tax credits covering the periods 2010 through 2014.

Near-Term Outlook

"We currently expect that sales volumes of our per-unit licensees in fourth quarter 2015 will drive our first quarter 2016 total revenue to a range of between $99 million and $102 million, comprised entirely of recurring revenue," said Richard J. Brezski, Chief Financial Officer. "This expected sequential quarterly increase in recurring revenue is based on the same set of licensees and is driven, in part, by second half 2015 product introductions that saw market success, but it also reflects a cyclical element that is typically present in our first quarter results. Consistent with our practice, this revenue guidance is based on royalty reports received to date, and does not include the potential impact of any new patent license, technology solutions or patent sale agreements that may be signed, or any arbitration or dispute resolutions that may occur, during the balance of first quarter 2016."

Conference Call Information

InterDigital will host a conference call on Thursday, February 18, 2016 at 10:00 a.m. Eastern Time to discuss its fourth quarter and full year 2015 financial performance and other company matters.  A live Internet webcast of the conference call will be available at  www.interdigital.com, under "Events and Presentations" in the Investors section. The company encourages participants to take advantage of the Internet option.

For telephone access to the conference, call (877) 876-9175 within the United States or +1 (785) 424-1668 from outside the United States. Please call by 9:50 a.m. ET on February 18 and give the operator Conference ID number 5332394.

An Internet replay of the conference call will be available on InterDigital's website in the Investors section, under "Events and Presentations." In addition, a telephone replay will be available from 1:00 p.m. ET February 18 through 1:00 p.m. ET February 23. To access the recorded replay, call (888) 203-1112 or +1 (719) 457-0820 and use the replay code 5332394.

About InterDigital^®

InterDigital develops mobile technologies that are at the core of devices, networks, and services worldwide. We solve many of the industry's most critical and complex technical challenges, inventing solutions for more efficient broadband networks and a richer multimedia experience years ahead of market deployment. InterDigital has licenses and strategic relationships with many of the world's leading wireless companies.  Founded in 1972, InterDigital is listed on NASDAQ and is included in the S&P MidCap 400^® index.

InterDigital is a registered trademark of InterDigital, Inc.

For more information, visit the InterDigital website: www.interdigital.com. 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.  Such statements include information regarding our current beliefs, plans and expectations, including, without limitation, (i) our plans to continue to focus on broadening our wireless customer base while working to penetrate new markets in IoT and connected technologies and (ii) our current expectations with respect to the company's first quarter 2016 revenue. Words such as "believe," “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “forecast,” and variations of any such words or similar expressions are intended to identify such forward-looking statements.