2 Throughout this press release, net income (loss) and diluted earnings per share ("EPS") are attributable to InterDigital, Inc. (e.g., after adjustments for noncontrolling interests), unless otherwise stated.
3 Free cash flow is a supplemental non-GAAP financial measure that InterDigital believes is helpful in evaluating the company's ability to invest in its business, make strategic acquisitions and fund share repurchases, among other things. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in the company's cash balance for the period. InterDigital defines “free cash flow” as net cash provided by operating activities less purchases of property and equipment, technology licenses and investments in patents. InterDigital's computation of free cash flow might not be comparable to free cash flow reported by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. A detailed reconciliation of free cash flow to net cash used in operating activities, the most directly comparable GAAP financial measure, is provided at the end of this press release.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands except per share data)
(unaudited)
|
FOR THE THREE
MONTHS ENDED MARCH 31, | |||||||
| 2020 | 2019 | ||||||
| REVENUES: | |||||||
| Variable patent royalty revenue | $ | 5,946 | $ | 9,280 | |||
| Fixed-fee royalty revenue | 66,347 | 62,873 | |||||
| Current patent royalties | 72,293 | 72,153 | |||||
| Non-current patent royalties | 705 | (5,775 | ) | ||||
| Total patent royalties | 72,998 | 66,378 | |||||
| Patent sales | — | 225 | |||||
| Current technology solutions revenue | 3,212 | 2,028 | |||||
| $ | 76,210 | $ | 68,631 | ||||
| OPERATING EXPENSES: | |||||||
| Patent administration and licensing | 40,108 | 36,071 | |||||
| Development | 18,818 | 18,495 | |||||
| Selling, general and administrative | 12,603 | 14,215 | |||||
| 71,529 | 68,781 | ||||||
| Income (loss) from operations | 4,681 | (150 | ) | ||||
| INTEREST EXPENSE | (10,545 | ) | (9,478 | ) | |||
| OTHER INCOME (EXPENSE), NET | 6,023 | 3,615 | |||||
| Income (loss) before income taxes | 159 | (6,013 | ) | ||||
| INCOME TAX BENEFIT (PROVISION) | (1,820 | ) | 1,799 | ||||
| NET INCOME (LOSS) | $ | (1,661 | ) | $ | (4,214 | ) | |
| Net loss attributable to noncontrolling interest | (1,777 | ) | (1,411 | ) | |||
| NET INCOME (LOSS) ATTRIBUTABLE TO INTERDIGITAL, INC. | $ | 116 | $ | (2,803 | ) | ||
| NET INCOME (LOSS) PER COMMON SHARE — BASIC | $ | — | $ | (0.09 | ) | ||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — BASIC | 30,722 | 32,611 | |||||
| NET INCOME (LOSS) PER COMMON SHARE — DILUTED | $ | — | $ | (0.09 | ) | ||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — DILUTED | 30,920 | 32,611 | |||||
| CASH DIVIDENDS DECLARED PER COMMON SHARE | $ | 0.35 | $ | 0.35 | |||
SUMMARY CONSOLIDATED CASH FLOWS
