What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-05 compared with 2025-02-06 · 315 added, 334 removed, 1023 unchanged (39% of the section changed)

14 unchanged sentences

We have audited the accompanying consolidated balance sheets of InterDigital, Inc.

and its subsidiaries (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of income, of comprehensive income, of shareholders' equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes (collectively referred to as the "consolidated financial statements").

and its subsidiaries (the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of income, of comprehensive income, of shareholders' equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the "consolidated financial statements").

We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition – Determination of Standalone Selling Prices of Identified Performance Obligations in Dynamic Fixed-Fee License Agreements Entered Into During The Year

As described in Notes 2 and 3 to the consolidated financial statements, dynamic fixed-fee license agreements include fixed, non-refundable royalty payments that fulfill the licensee’s obligations to the Company under a patent license agreement for a specified time period or for the term of the agreement.

Total recurring revenues and catch-up revenues were $408 million and $460 million, respectively, for the year ended December 31, 2024, of which a significant portion relates to dynamic fixed-fee agreements entered into during the year.

Total revenue and catch-up revenue were $834 million and $277 million, respectively, for the year ended December 31, 2025, of which a significant portion relates to dynamic fixed-fee agreements entered into during the year.

As disclosed by management, the process for determining the value of the standalone selling prices of identified performance obligations in dynamic fixed-fee license agreements requires the exercise of significant judgment when evaluating the valuation methods and assumptions, including the assumed royalties, projected sales volumes, discount rate, identification of comparable market transactions which are not directly observable and other relevant factors.

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Evaluating the reasonableness of management’s significant assumptions related to assumed royalties and projected sales volumes involved considering consistency with historical sales data.

Revenue Recognition – Determination of the Amount of Consideration in Certain Arrangements with Variable Consideration

As described in Notes 2 and 3 to the consolidated financial statements, for certain patent license arrangements or other contractual arrangements, the amount of consideration that the Company will receive is uncertain.

In such cases, management estimates and recognizes licensing revenues only when the Company has a contract, as defined in the revenue recognition guidance.

Such estimates are only recognized to the extent it is probable that a significant reversal of cumulative revenues recognized will not occur.

Total recurring revenues and catch-up revenues were $408 million and $460 million, respectively, for the year ended December 31, 2024, of which a portion relates to certain arrangements with variable consideration.

Management analyzes the risk of a significant revenue reversal considering both the likelihood and magnitude of the reversal and, if necessary, constrains the amount of estimated revenues in order to mitigate this risk, which may result in recognizing revenues less than amounts management expects the Company is most likely to receive.

As disclosed by management, these estimates may require significant judgment.

The principal considerations for our determination that performing procedures relating to the determination of the amount of consideration in certain arrangements with variable consideration is a critical audit matter are (i) the significant judgment by management when determining the amount of consideration and (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management's significant assumptions and judgments in determining the amount of consideration, including the analysis of the probability that a significant reversal of cumulative revenues recognized will not occur.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the revenue recognition process, including controls over the determination of the amount of consideration in certain arrangements with variable consideration.

These procedures also included, among others (i) reading certain arrangements applicable for the current year;

(ii) testing management’s process for determining the amount of consideration in such arrangements;

(iii) evaluating the appropriateness of management’s analysis used in determining the amount of consideration;

(iv) testing the completeness and accuracy of the data used by management in the analysis;

and (v) evaluating the reasonableness of management’s significant assumptions and judgments in determining the amount of consideration, including the analysis of the probability that a significant reversal of cumulative revenues recognized will not occur.

Evaluating the reasonableness of management’s significant assumptions and judgments in determining the amount of consideration, including the analysis of the probability that a significant reversal of cumulative revenues will not occur, involved considering management’s past experience in such arrangements, status of ongoing discussions with the customer, and advice obtained, including obtaining and evaluating the letters of audit inquiry from in-house and external legal counsel.

/s/ PricewaterhouseCoopers LLP

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Retained earnings 2,113,240 1,775,823

Accumulated other comprehensive loss ( 458 ) ( 647 )

Accumulated other comprehensive income (loss)

Treasury stock, 45,280 and 44,895 shares of common stock held at cost

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2025 2024 2023

Revenues $ 868,516 $ 549,588 $ 457,794

$ 834,015 $ 868,516 $ 549,588

Operating expenses:

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General and administrative 68,088 62,862 53,291

Restructuring activities — — 3,280

Total operating expenses 373,162 429,004 327,973

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Interest expense ( 39,962 ) ( 45,421 ) ( 44,817 )

Other income (expense), net 35,325 57,812 ( 3,457 )

Other income, net 48,541 35,325 57,812

Income before income taxes 469,432 429,416 234,610

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$ 406,644 $ 358,614 $ 214,069

Net income per common share — Basic $ 14.16 $ 7.97 $ 3.11

Weighted average number of common shares outstanding — Basic 25,325 26,860 30,106

Net income per common share — Diluted $ 12.07 $ 7.62 $ 3.07

Weighted average number of common shares outstanding — Diluted 29,711 28,102 30,485

Net income per common share:

Basic $ 15.77 $ 14.16 $ 7.97

Diluted $ 11.80 $ 12.07 $ 7.62

Weighted average number of common shares outstanding:

Basic 25,794 25,325 26,860

Diluted 34,474 29,711 28,102

Cash dividends declared per common share $ 2.60 $ 1.70 $ 1.50

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Net income $ 406,644 $ 358,614 $ 211,053

Unrealized gain (loss) on investments, net of tax 189 269 ( 345 )

Unrealized gain on investments, net of tax 757 189 269

Comprehensive income 407,401 358,803 211,322

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(in thousands, except per share data)

Comprehensive

Common Stock Additional

Paid-In Capital Retained Earnings Treasury Stock Non-Controlling

Interest Total

Shareholders'

Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss)

Treasury Stock Non-Controlling Interest

Total Shareholders' Equity

Shares Amount Shares Amount

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Net loss attributable to noncontrolling interest — — — — — — — ( 3,016 ) ( 3,016 )

Noncontrolling interest distribution — — — — — — — ( 1,928 ) ( 1,928 )

Deconsolidation of Convida — — — — — — — ( 4,352 ) ( 4,352 )

Non-controlling interest contributions — — — — — — — 1,750 1,750

Net change in unrealized loss on short-term investments — — — — ( 345 ) — — — ( 345 )

Net change in unrealized gain on short-term investments

— — — — 269 — — — 269

Dividends declared ($ 1.50 per share)

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Repurchase of common stock ( 2,739 ) ( 27 ) — ( 203,354 ) — 1,672 ( 139,493 ) — ( 342,874 )

Net convertible note hedge transactions, net of tax — — ( 54,257 ) — — — — — ( 54,257 )

Net warrant transactions — — 39,863 — — — — — 39,863

Balance, December 31, 2023 69,507 $ 694 $ 742,981 $ 1,462,070 $ ( 647 ) 43,927 $ ( 1,623,549 ) $ — $ 581,549

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— — — 358,614 — — — — 358,614

Net loss attributable to noncontrolling interest — — — — — — ( 3,016 ) ( 3,016 )

Deconsolidation of Convida — — — — — — — ( 4,352 ) ( 4,352 )

Non-controlling interest contributions — — — — — — — 1,750 1,750

Net change in unrealized gain on short-term investments

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Repurchase of common stock — — — — — 644 ( 66,726 ) — ( 66,726 )

Settlement of the 2024 Notes 324 3 ( 3 ) — — — — — —

Settlement of the 2024 Hedges — — 37,120 — — 324 ( 37,120 ) — —

Settlement of the 2024 Warrants 487 5 ( 23 ) — — — — — ( 18 )

Balance, December 31, 2024 70,577 $ 705 $ 808,540 $ 1,775,823 $ ( 458 ) 44,895 $ ( 1,727,395 ) $ — $ 857,215

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Net change in unrealized gain on short-term investments — — — — 757 — — — 757

— — — — 189 — — — 189

Dividends declared ($ 2.60 per share)

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— — 43,156 — — — — — 43,156

Settlement of the 2027 Hedge

— — 40 — — — ( 40 ) — —

Repurchase of common stock — — — — — 385 ( 102,596 ) — ( 102,596 )

Settlement of the 2024 Notes 324 3 ( 3 ) — — — — — —

Settlement of the 2024 Hedges — — 37,120 — — 324 ( 37,120 ) — —

Settlement of the 2024 Warrants 487 5 ( 23 ) — — — — — ( 18 )

Balance, December 31, 2025 70,965 $ 709 $ 816,903 $ 2,113,240 $ 299 45,280 $ ( 1,830,031 ) $ — $ 1,101,120

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Depreciation and amortization 77,531 69,913 77,792

Non-cash change in investments ( 676 ) ( 10,130 ) 1,686

Change in deferred revenue ( 33,524 ) ( 24,335 ) ( 49,176 )

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Other ( 3,877 ) ( 10,044 ) ( 25,816 )

(Increase) Decrease in assets:

Decrease (Increase) in assets:

Receivables 118,486 ( 71,010 ) ( 64,110 )

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Purchases of short-term investments ( 480,086 ) ( 542,464 ) ( 836,370 )

Sales of short-term investments 699,124 797,703 260,771

Proceeds from maturities and sales of short-term investments

419,486 699,124 797,703

Purchases of property and equipment ( 15,888 ) ( 5,849 ) ( 4,268 )

Capitalized patent costs ( 54,627 ) ( 52,888 ) ( 40,358 )

Acquisition of patents ( 4,250 ) — —

( 8,750 ) ( 4,250 ) —

Long-term investments ( 415 ) 15,778 ( 1,877 )

Net cash provided by (used in) investing activities 109,451 ( 85,170 ) ( 314,706 )

Net cash (used in) provided by investing activities

( 140,280 ) 109,451 ( 85,170 )

Cash flows from financing activities:

Proceeds from issuance of convertible senior notes — — 460,000

Purchase of convertible bond hedge — — ( 80,500 )

Proceeds from issuance of warrants — — 43,700

Payments on long-term debt ( 1,497 ) ( 141,442 ) —

Proceeds from bond hedge unwind — — 11,851

Payment for warrant unwind and settlement — ( 18 ) —

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Dividends paid ( 60,682 ) ( 41,799 ) ( 39,454 )

Net cash (used in) provided by financing activities ( 272,393 ) ( 388,763 ) 18,604

Net cash used in financing activities

( 201,449 ) ( 272,393 ) ( 388,763 )

Net increase (decrease) in cash, cash equivalents and restricted cash 202,721 108,586 ( 260,200 )

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Principles of Consolidation

The accompanying consolidated financial statements include all of our accounts and all entities in which we have a controlling interest and/or are required to be consolidated in accordance with the Generally Accepted Accounting Principles in the United States (“GAAP”).

The accompanying consolidated financial statements include all of our accounts and all entities in which we have a controlling interest and/or are required to be consolidated in accordance with Generally Accepted Accounting Principles in the United States ("GAAP").

All significant intercompany accounts and transactions have been eliminated in consolidation.

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Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ from these estimates.

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Interest paid $ 16,100 $ 17,361 $ 18,623

Income taxes paid, including foreign withholding taxes 67,541 59,202 6,805

Income taxes paid:

Federal 15,389 35,050 45,500

State 357 704 1,541

Korea 63,332 10,918 4,645

China 27,829 19,044 5,700

Other Foreign Jurisdictions 2,224 1,825 1,816

Non-cash investing and financing activities:

Settlement of the 2024 Hedge Transactions 37,120 — —

Dividend payable 11,557 10,226 10,384

Accrued debt issuance costs — — 100

Accrued taxes on the repurchase of common stock — 3,170 —

Non-cash acquisition of patents 21,219 7,000 —

Non-cash distribution of patents — — 1,928

Right-of-use assets obtained in exchange of operating lease liabilities 2,066 93 6,644

Dividend payable 17,980 11,557 10,226

Accrued capitalized patent costs and property and equipment 6,108 ( 2,077 ) 670

Right-of-use assets obtained in exchange of operating lease liabilities 1,387 2,066 93

Accrued taxes on the repurchase of common stock 277 — 3,170

Settlement of the 2027 and 2024 Hedge Transactions 40 37,120 —

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NEW ACCOUNTING GUIDANCE

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If an investment is deemed to have experienced an other-than-temporary decline below its cost basis, we reduce the carrying amount of the investment to its quoted or estimated fair value, as applicable, and establish a new cost basis for the investment.

We charge the impairment to the " Other income (expense), net" line of our consolidated statements of income.

We charge the impairment to the " Other income, net" line of our consolidated statements of income.

Intangible Assets

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If the carrying value of our reporting unit exceeds the reporting unit’s fair value, a goodwill impairment charge will be recorded for the difference up to the carrying value of goodwill.

The carrying value of goodwill was $ 22.4 million as of December 31, 2024 and December 31, 2023, which was included within " Other non-current assets, net " in the consolidated balance sheets.

The carrying value of goodwill was $ 24.1 million and $ 22.4 million as of December 31, 2025 and December 31, 2024, which was included within " Other non-current assets, net " in the consolidated balance sheets.

No impairments were recorded during 2025, 2024 or 2023 as a result of our annual goodwill impairment assessment.

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Costs incurred after final acceptance testing has been successfully completed are expensed.

Capitalized computer software costs are amortized over their estimated useful life of three years .

Capitalized computer software costs are amortized over the estimated service life.

All computer software costs capitalized to date relate to the purchase, development and implementation of engineering, accounting and other enterprise software.

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These steps include (1) identifying the contract with the customer, (2) identifying the performance obligations, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations, and (5) recognizing revenue as the entity satisfies the performance obligation(s).

Additionally, we have elected to utilize certain practical expedients in the application of ASC 606.

Additionally, we have elected to utilize certain practical expedients in the application of ASC 606, Revenue From Contracts with Customers .

In evaluating the presence of a significant financing component in our agreements, we utilize the practical expedient to exclude any contracts wherein the gap between payment by our customers and the delivery of our performance obligation is less than one year.

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Timing of revenue recognition may differ significantly from the timing of invoicing to customers.

Contract assets are included in accounts receivable and represent unbilled amounts expected to be received from customers in future periods, where the revenue recognized to date exceeds the amount billed, and right to payment is subject to the underlying contractual terms.

Contract assets are classified as long-term assets if the payments are expected to be received more than one year from the reporting date.

Contract assets represent unbilled amounts expected to be received from customers in future periods, where the revenue recognized to date exceeds the amount billed, and right to payment is subject to the underlying contractual terms.

Contract assets due within less than twelve months of the balance sheet date are included within accounts receivable in our consolidated balance sheets.

Contract assets due more than twelve months after the balance sheet date are included within other non-current assets.

Contract assets are classified as long-term assets within other non-current assets if the payments are expected to be received more than one year from the reporting date.

For certain patent license agreements or other contractual arrangements, the amount of consideration that we will receive is uncertain.

In such cases, we estimate and recognize licensing revenues only when we have a contract, as defined in the revenue recognition guidance.

Such estimates are only recognized to the extent it is probable that a significant reversal of cumulative revenues recognized will not occur.

We analyze the risk of a significant revenue reversal considering both the likelihood and magnitude of the reversal and, if necessary, constrain the amount of estimated revenues in order to mitigate this risk, which may result in recognizing revenues less than amounts we expect we are most likely to receive.

In such cases, we estimate and recognize licensing revenue only when we have a contract, as defined in the revenue recognition guidance.

Such estimates are only recognized to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur.

We analyze the risk of a significant revenue reversal considering both the likelihood and magnitude of the reversal and, if necessary, constrain the amount of estimated revenue in order to mitigate this risk, which may result in recognizing revenue less than amounts we expect we are most likely to receive.

These aforementioned estimates may require significant judgment.

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Fixed-fee license agreements include fixed, non-refundable royalty payments that fulfill the licensee’s obligations to us under a patent license agreement for a specified time period or for the term of the agreement for specified products, under certain patents or patent claims, for sales in certain countries, or a combination thereof - in each case for a specified time period (including for the life of the patents licensed under the agreement).

Dynamic fixed-fee license agreements contain a single performance obligation that represents ongoing access to a portfolio of technology over the license term, since our promise to transfer to the licensee access to the portfolio as it exists at inception of the license, along with promises to provide any technology updates to the portfolio during the term, are not separately identifiable.

Upon entering a new agreement, we allocate the transaction price to the performance obligations delivered at signing (e.g.

our existing patent portfolio) and future performance obligations (e.g.

the technology updates).

Dynamic fixed-fee license agreements contain a performance obligation that represents ongoing access to a portfolio of technology over the license term, since our promise to transfer to the licensee access to the portfolio as it exists at inception of the license, along with promises to provide any technology updates to the portfolio during the term, are not separately identifiable.

We use a time-based input method of progress to determine the timing of revenue recognition, and as such we recognize the future deliverables on a straight-line basis over the term of the agreement.

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Upon entering a new variable patent license agreement, the licensee typically agrees to pay royalties or license fees on licensed products sold during the term of the agreement.

We utilize the sales- or usage- based royalty exception for these agreements and recognize revenues during the contract term when the underlying sale or usage occurs.

Our licensees under variable agreements provide us with quarterly royalty reports that summarize their sales of covered products and their related royalty obligations to us.

We typically receive these royalty reports subsequent to the period in which our licensees’ underlying sales occurred.

As a result, we are required to estimate revenues and recognize sales-based royalties on such licensed products in the period in which the associated sales occur, considering all relevant information (historical, current and forecasted) that is reasonably available to us.

We utilize the sales- or usage- based royalty exception for these agreements and recognize revenue during the contract term when the underlying sale or usage occurs.

Our licensees under variable agreements typically provide us with quarterly royalty reports that summarize their sales of covered products and their related royalty obligations to us.

We receive these royalty reports subsequent to the period in which our licensees’ underlying sales occurred.

As a result, we are required to estimate revenue and recognize sales-based royalties on such licensed products in the period in which the associated sales occur, considering all relevant information (historical, current and forecasted) that is reasonably available to us.

Estimating licensees’ quarterly royalties prior to receiving the royalty reports requires us to make assumptions and judgments related to forecasted trends and growth rates used to estimate our licensees’ sales, which could have an impact on the amount of revenue we report on a quarterly basis.

As a result of recognizing revenues in the period in which the licensees’ sales occur using estimates, adjustments to revenues are required in subsequent periods to reflect changes in estimates as new information becomes available, primarily resulting from actual amounts reported by our licensees.

As a result of recognizing revenue in the period in which the licensees’ sales occur using estimates, adjustments to revenue are required in subsequent periods to reflect changes in estimates as new information becomes available, including market information, royalty reports provided by our licensees, audit results, among others.

Hybrid Agreements

We enter into hybrid patent license agreements that include (i) a fixed-fee minimum guarantee and (ii) additional per-unit royalties for units sold in excess of the units covered by the minimum guarantee.

Under these agreements, the fixed-fee component represents a minimum amount the licensee is required to pay and provides a license to our technologies up to a specified number of units sold, with incremental per-unit royalties due for units sold in excess of the unit cap.

When a licensee's sales exceed the unit cap, we recognize revenue for the additional per-unit royalties in the periods in which we estimate the licensee has exceeded the minimum and adjust revenue based on actual usage once reported by the licensee.

The fixed-fee, or minimum guarantee, portion of a hybrid agreement is recognized on the same basis as our other fixed-fee agreements, as described above.

Accounts Receivable

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Generally, the classification of a transaction under a collaborative arrangement is determined based on the nature and contractual terms of the arrangement along with the nature of the operations of the participants.

For transactions that are deemed to be a collaborative arrangement under ASC 808, costs incurred and revenues generated on sales to third parties will be reported in our consolidated statement of operations on a gross basis if the Company is deemed to be the principal in the transaction, or on a net basis if the Company is instead deemed to be the agent in the transaction, consistent with the guidance in ASC 606-10-55-36, Revenue From Contracts with Customers - Principal Agent Considerations .

For transactions that are deemed to be a collaborative arrangement under ASC 808, costs incurred and revenue generated on sales to third parties will be reported in our consolidated statement of operations on a gross basis if the Company is deemed to be the principal in the transaction, or on a net basis if the Company is instead deemed to be the agent in the transaction, consistent with the guidance in ASC 606-10-55-36, Revenue From Contracts with Customers - Principal Agent Considerations .

Deferred Charges

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These costs are being amortized over the term of the debt using the effective interest method and are included within the " Interest expense" line of our consolidated statements of income.

The Company incurred $ 9.9 million of new debt issuances costs in 2022 in conjunction with the issuance of the 2027 Notes and no new debt issuance costs were incurred in 2024 or 2023.

No new debt issuance costs were incurred in 2025, 2024, or 2023.

Deferred financing expense was $ 2.1 million, $ 2.2 million and $ 2.3 million in 2025, 2024, and 2023, respectively.

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The inclusion of windfalls and shortfalls in the tax provision could increase our earnings volatility between periods.

Tax windfalls and shortfalls related to share-based compensation was windfalls of $ 4.9 million and $ 3.1 million for the years ended 2024 and 2023, respectively, and shortfalls for the year ended 2022 of $ 0.4 million, respectively.

Restructuring

Restructuring activities include, but are not limited to, costs associated with termination benefits such as severance costs and retention bonuses, contract termination costs, and other costs associated with an exit or disposal activity.

The termination benefits included within restructuring activities are recognized in accordance with either ASC 420, Exit or Disposal Cost Obligations ("ASC 420") or ASC 712, Compensation – Nonretirement Postemployment Benefits ("ASC 712"), as applicable.

Liabilities are recognized in accordance with ASC 420 when management commits to a plan of termination, the employees to be terminated are identified, the terms of the benefit arrangement are established, it was determined that either changes to the plan or withdrawal are unlikely, and the arrangements were communicated to employees.

Liabilities that fall under ASC 712 are recognized when the liability was determined to be probable of being paid and reasonably estimable.

Tax windfalls related to share-based compensation were of $ 7.4 million, $ 4.9 million, and $ 3.1 million for the years ended 2025, 2024, and 2023, respectively.

Income taxes are accounted for under the asset and liability method.

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If the Treasury shares are retired, the excess of the par value is included with retained earnings.

In August 2022, the Inflation Reduction Act was enacted in the United States, which included, among other items, a 1 % excise tax on certain net stock repurchases after December 31, 2022.

In August 2022, the Inflation Reduction Act was enacted in the United States, which included, among other items, a 1 % excise tax on certain net repurchases of our common stock after December 31, 2022.

This excise tax on our share repurchases is recorded as a component of stockholders’ equity, as treasury stock, or retained earnings if retired.

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Accounting Standards Update:

Interim Reporting (Topic 270):

Narrow-Scope Improvements

In December 2025, the FASB issued ASU 2025-11 to amend the guidance in “Interim Reporting” (Topic 270).

The update provides clarifications intended to improve the consistency and usability of interim disclosure requirements, including a comprehensive listing of required interim disclosures and a new disclosure principle for reporting material events occurring after the most recent annual period.

The amendments do not change the underlying objectives of interim reporting but are designed to enhance clarity in application.

The guidance is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years.

We are currently evaluating the impact of adoption on our consolidated financial statements.

Accounting Standards Update:

Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued ASU No.

2025-06, "Intangibles—Goodwill and Other Internal-Use Software (Subtopic 350-40)".

The amendments in the ASU amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40.

ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, with early adoption allowed.

We are currently evaluating the impact of adoption on our consolidated financial statements.

Accounting Standards Update:

Induced Conversions of Convertible Debt Instruments

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ASU 2024-04 is effective for fiscal years beginning after December 15, 2025, with early adoption allowed.

We are currently evaluating the impact of adoption on our financial disclosures.

We are currently evaluating the impact of adoption on our consolidated financial statements.

Accounting Standards Update:

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Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No.

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates ("ASU") No.

2023-09, “Income Taxes (Topic 740):

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ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption allowed.

We are currently evaluating the impact of adoption on our financial disclosures.

Accounting Standards Update:

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU No.

2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”.

The amendments in the ASU require disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”), a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, with early adoption allowed.

We adopted this guidance as of January 1, 2024, and the adoption did not have a material impact on our consolidated financial statements.

Refer to Note 4, " Segment and Concentration Information ," for new disclosures resulting from the adoption of ASU 2023-07.

We retrospectively adopted this guidance as of January 1, 2025, and included the necessary disclosures in this Form 10-K.

REVENUE RECOGNITION

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2025 2024 2023

Recurring revenues:

Smartphone $ 678,855 $ 597,540 $ 467,283

1 unchanged sentence

Other 529 2,296 1,410

Total recurring revenues 408,447 408,392 403,888

Catch-up revenues (a)

Total Revenue $ 834,015 $ 868,516 $ 549,588

Catch-up revenue (a) , included above

$ 277,409 $ 460,069 $ 141,196

Total revenues $ 868,516 $ 549,588 $ 457,794

(a) Catch-up revenues are comprised of past patent royalties and revenues from static fixed-fee agreements.

(a) Catch-up revenue represents revenue associated with reporting periods prior to the execution of the license agreement.

During the year ended December 31, 2025, we recognized $ 178.0 million of revenue that had been included in deferred revenue as of the beginning of the period.

As of December 31, 2025 and 2024, we had contract assets of $ 19.7 million and $ 162.8 million included within " Accounts receivable, net " in the consolidated balance sheet, respectively.

As of December 31, 2025, we also had $ 21.0 million contract assets included within " Other non-current assets, net " in the consolidated balance sheet.

Contracted Revenue

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Thereafter 73,758

(a) This table includes estimated revenue related to our Samsung and Lenovo arbitrations.

(a) This table includes estimated revenue related to our Lenovo arbitration.

In accordance with ASC 606, these estimates are limited to the amount of revenue we expect to recognize only to the extent we believe it is probable that a subsequent change in the estimate would not result in a significant revenue reversal.

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Revenue share costs 10,140 81,318 3,332

Restructuring costs — — 3,280

Other non-operating expense (income), net (b)

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During 2025, 2024, and 2023, the majority of our revenue was derived from a limited number of licensees based outside of the United States, primarily in Asia.

Substantially all of these revenues were paid in U.S.

Substantially all of this revenue was paid in U.S.

dollars and were not subject to any substantial foreign exchange transaction risk.

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Taiwan 12,320 9,620 9,368

Europe 7,391 2,319 10,543

Japan 7,095 7,223 10,678

Europe 3,348 7,391 2,319

Total revenue $ 834,015 $ 868,516 $ 549,588

During 2024, 2023, and 2022, the following licensees or customers accounted for 10% or more of total revenues:

During 2025, 2024, and 2023, the following licensees or customers accounted for 10% or more of total revenue:

Year Ended December 31,

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Customer E < 10 % 14 % — %

As of December 31, 2024, and 2023, we held $ 327.2 million and $ 324.6 million of our property, equipment and patents, net of accumulated depreciation and amortization, respectively, of which approximately 89 % of the total was within the United States in each of the years presented.

As of December 31, 2024 and 2023, we held $ 36.6 million and $ 29.3 million of property, equipment and patents, net of accumulated depreciation and amortization, collectively, in Canada and Europe.

Customer F < 10 % < 10 % 11 %

As of December 31, 2025, and 2024, our property and equipment, net of accumulated depreciation, and patents, net of accumulated amortization, totaled $ 342.5 million and $ 327.2 million, respectively.

Approximately 85 % of these assets were located in the United States in each year presented.

The remaining of these net assets were located primarily in Canada and Europe, where we held $ 50.7 million and $ 36.6 million a s of December 31, 2025, and 2024, respectively.

CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES

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As of December 31, 2025 and 2024, the majority of our marketable securities are classified as available-for-sale and are carried at fair value, with unrealized gains and losses reported net-of-tax as a separate component of shareholders’ equity.

Substantially all of our investments are investment-grade government and corporate debt securities that have maturities of less than two years , and we have both the ability and intent to hold the investments until maturity.

Substantially all of our investments are investment-grade government and corporate debt securities that have maturities of less than three years , and we have both the ability and intent to hold the investments until maturity.

We recorded no other-than-temporary impairments during 2025, 2024, or 2023.

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Our accounts receivable are derived principally from patent license and technology solutions agreements.

Three licensees comprised 84 % and 75 % of our accounts receivable balance as of December 31, 2024 and 2023, respectively.

As of December 31, 2025 and 2024, three licensees comprised 55 % and 84 % of our accounts receivable balance, respectively.

We perform ongoing credit evaluations of our licensees, who generally include large, multinational, wireless telecommunications equipment manufacturers.

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$ 745,024 $ — $ — $ 745,024

Commercial paper (b)

Commercial paper

— 121,361 — 121,361

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(a) Included within cash and cash equivalents.

(b) As of December 31, 2024 and 2023, $ 4.1 million and $ 5.7 million of commercial paper was included within cash and cash equivalents, respectively.

(b) As of December 31, 2024 $ 4.1 million of commercial paper was included within cash and cash equivalents, respectively.

(c) As of December 31, 2025 and 2024, $ 9.2 million and $ 11.7 million of corporate bonds, asset backed and other securities was included within cash and cash equivalents, respectively.

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$ 459,986 $ 456,786 $ 1,905,819 $ 460,000 $ 454,739 $ 1,166,155

2024 Senior Convertible Notes

$ — $ — $ — $ 126,174 $ 125,922 $ 171,130

Technicolor Patent Acquisition Long-term Debt

As more fully disclosed in Note 10, " Obligations ," we recognized long-term debt in conjunction with the acquisitions of the patent licensing business and research and innovation unit of Technicolor SA (the "Technicolor Patent Acquisition").

As more fully disclosed in Note 10, " Obligations ," we recognized long-term debt in conjunction with the Technicolor Patent Acquisition.

The carrying value and related estimated fair value of the Technicolor Patent Acquisition long-term debt reported in the consolidated balance sheet as of December 31, 2025 and 2024 was as follows (in thousands).

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Any adjustments to the carrying value of those investments are considered non-recurring fair value measurements.

During years ended December 31, 2024 and 2023, we recognized net gains of $ 2.0 million and $ 10.4 million, respectively, and during year ended 2022 we recognized a net loss of $ 1.3 million resulting from observable price changes of our long-term strategic investments, which were included within “ Other income (expense), net ” in the consolidated statement of income.

We recognized a net loss of $ 1.0 million during year ended December 31, 2025 and net gains of $ 2.0 million and $ 10.4 million during years ended 2024 and 2023, respectively resulting from observable price changes of our long-term strategic investments, which were included within “ Other income, net ” in the consolidated statement of income.

Certain of our investments in other entities may be seeking additional financing in the next twelve months or potential exit strategies.

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Our investment in Convida Wireless is accounted for as an equity method investment in accordance with ASC 323 "Investments – Equity Method and Joint Ventures" and included within "Other non-current assets, net" in the consolidated balance sheet.

During 2024, we entered into patent license agreements in which a portion of the future consideration was in the form of patents.

We estimated fair value of the patents subject to the agreements to be $ 10.0 million for determining the transaction price for revenue recognition purposes utilizing a combination of the market and cost approaches.

The $ 7.0 million of the patents transferred during 2024 and the remaining $ 3.0 million patents will transfer in early 2025.

During fourth quarter 2025, this entity was fully dissolved.

During 2025 and 2024, we entered into patent license agreements in which a portion of the future consideration was in the form of patents.

We estimated fair value of the patents subject to the agreements to be $ 3.0 million and $ 10.0 million in 2025 and 2024, respectively, for determining the transaction price for revenue recognition purposes utilizing a combination of the market and cost approaches.

The value will be amortized as a non-cash expense over the patents' estimated useful lives.

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Goodwill balance as of December 31, 2024

Activity 1,652

Goodwill balance as of December 31, 2025 $ 24,073

In October 2025, we acquired Deep Render, an AI startup with a team of world-class AI experts focusing on video codecs for cash considerations.

We believe the acquisition adds significant depth to our existing AI expertise and strengthens the company’s leadership in video compression.

The transaction also adds Deep Render’s patent portfolio in AI-based video coding to our market-leading video portfolio.

As part of the deal, a team of AI experts joined our Video Lab.

Founded in London in 2018, Deep Render has pioneered the use of AI in video and image compression to change the way that video is processed and ultimately distributed to connected devices and services.

As part of the transaction, the vast majority of the acquired value was assigned to patents, with the remaining resulting in the recognition of goodwill.

The goodwill is included in the “ Other non-current assets, net " in the consolidated balance sheet.

OTHER ASSETS AND LIABILITIES

The amounts included in " Prepaid and other current assets " in the consolidated balance sheet as of December 31, 2025 and 2024 were as follows (in thousands):

Prepaid assets $ 38,952 $ 9,353

Restricted cash 24,187 5,885

Tax receivables $ 39,638 $ 16,691

Restricted cash 15,308 24,187

Prepaid assets 13,335 38,952

Other current assets 6,713 4,482

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Goodwill 24,073 22,421

Long-term investments 19,851 31,895

Contract asset

Right-of-use assets 13,797 15,218

Long-term investments 11,718 19,851

Other non-current assets 23,091 3,291

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Accrued legal fees $ 14,008 $ 9,571

Customer deposit — 76,100

Other accrued expenses 8,318 15,563

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$ 459,986 $ 460,000

2.00% Senior Convertible Notes due 2024

Deferred financing costs ( 3,200 ) ( 5,261 )

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Maturities of principal of the long-term debt obligations of the Company as of December 31, 2025, excluding the long-term debt resulting from the Technicolor Patent Acquisition, are as follows (in thousands):

2026 $ 80,003

2030 and thereafter —

The 3.50 % Senior Convertible Notes due 2027 (the "2027 Notes") are convertible during the period January 1, 2024 through March 31, 2026 and therefore are classified as " Current portion of long-term debt " as of December 31, 2025 and 2024 in our consolidated balance sheet.

The current conversion rate of the Notes is 12.9041 shares of our Common Stock per $1,000 principal amount of the 2027 Notes.

Upon the conversion of any 2027 Notes, we will pay cash up to the aggregate principal amount of the 2027 Notes to be converted, and will pay cash, shares of our Common Stock or a combination of cash and shares of its Common Stock for any conversion obligation in excess of the aggregate principal amount being converted, if any, at the Company’s election, as set forth in the Indenture governing the 2027 Notes.

In December 2025, certain holders elected to convert $ 80.0 million of principal, which will settle in first quarter 2026.

The principal of the converted notes will be paid in cash and the remaining amount will be settled in shares.

No incremental shares will be outstanding upon conversion due to the offsetting impact of a corresponding partial settlement of the 2027 Note Hedge Transactions.

There is no acceleration of the maturity of the 2027 Warrant Transactions as a result of holders electing conversion of the 2027 Notes.

As of December 31, 2025, all 6.0 million of the warrants under the 2027 Warrant Transactions are outstanding with a weighted average strike price of $ 105.67 per share, subject to adjustment, and mature beginning September 2027 through April 2028.

2027 Notes, and Related Note Hedge and Warrant Transactions

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The net proceeds from the issuance of the 2024 Notes, after deducting the initial purchasers' transaction fees and offering expenses, were approximately $ 391.6 million.

The 2024 Notes bore interest at a rate of 2.00 % per year, payable in cash on June 1 and December 1 of each year, commenced on December 1, 2019, and matured on June 1, 2024, unless earlier converted or repurchased.

The 2024 Notes bore interest at a rate of 2.00 % per year, payable in cash on June 1 and December 1 of each year, commenced on December 1, 2019, and matured on June 1, 2024.

In connection with the offering of the 2024 Notes, we entered into convertible note hedge transactions (collectively, the “2024 Note Hedge Transactions”) that cover, subject to customary anti-dilution adjustments, approximately 4.9 million shares of common stock, in the aggregate, at a strike price that corresponded to the initial conversion price of the 2024 Notes, subject to adjustment, and were exercisable upon any conversion of the 2024 Notes.

The aggregate cost of the 2024 Note Hedge Transactions was $ 72.0 million.

We also entered into privately negotiated warrant transactions (collectively, the “2024 Warrant Transactions” and, together with the 2024 Note Hedge Transactions, the “2024 Call Spread Transactions”), whereby we sold warrants to acquire, subject to customary anti-dilution adjustments, approximately 4.9 million shares of common stock at an initial strike price of $ 109.43 per share, subject to adjustment.

As consideration for the 2024 Warrant Transactions, we received aggregate proceeds of $ 47.6 million.

The net cost of the 2024 Call Spread Transactions was $ 24.4 million.

In 2022, the Company repurchased $ 273.8 million in aggregate principal amount of the 2024 Notes in privately negotiated transactions concurrently with the offering of the 2027 Notes.

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As a result of the partial unwind transactions, approximately 3.3 million shares of common stock in the aggregate that were covered under each of the 2024 Note Hedge Transactions and the 2024 Warrant Transactions were unwound.

Proceeds received from the unwind of the 2024 Note Hedge Transactions were $ 11.9 million, and consideration paid for the unwind of the 2024 Warrant Transactions was $ 3.8 million, resulting in net proceeds received of $ 8.0 million for the combined unwind transactions.

Because the concurrent redemption of the 2024 Notes and a portion of issuance of the 2027 Notes were executed with the same investors, we evaluated the transaction as a debt restructuring, on a creditor by creditor basis.

The accounting conclusion was based on whether the exchange was a contemporaneous exchange of cash between the same debtor and creditor in connection with the issuance of a new debt obligation and satisfaction of an existing debt obligation by the debtor and if it was determined to have substantially different terms.

All creditors involved in the repurchase transaction also purchased 2027 Notes in approximately the same or greater amount as the 2024 Notes principal repurchased.

Additionally, the repurchase of the 2024 Notes and issuance of the 2027 Notes were deemed to have substantially different terms on the basis that the fair value of the conversion feature increased by more than 10% of the carrying value of the 2024 Notes, and therefore, the repurchase of the 2024 Notes was accounted for as a debt extinguishment.

We recognized a $ 11.2 million loss on extinguishment of debt during 2022 in connection with this repurchase, which is included within " Other (expense) income, net " in the consolidated statement of income.

The loss on extinguishment represents the difference between the fair value of consideration paid to reacquire the 2024 Notes and the carrying amount of the debt, including any unamortized debt issuance costs attributable to the 2024 Notes redeemed.

The remaining unamortized debt issuance costs of $ 1.2 million was amortized throughout the remaining life of the 2024 Notes.

On June 1, 2024, the 2024 Notes matured and we repaid the remaining $ 126.2 million in aggregate principal in cash and issued 0.3 million common shares to settle the remaining obligation.

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Additionally, the 2024 Warrant Transactions settled, on a net-share basis during September through December 2024 resulting in the issuance of 0.5 million shares.

Convertible Notes Interest Expense

The following table presents the amount of interest cost recognized for the years ended December 31, 2025, 2024 and 2023 related to the contractual interest coupon and the amortization of financing costs (in thousands):

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2025 2024 2023

2027 Notes 2024 Notes Total 2027 Notes 2024 Notes Total 2027 Notes 2024 Notes Total

2027 Notes 2027 Notes 2024 Notes Total 2027 Notes 2024 Notes Total

Contractual coupon interest $ 15,866 $ 16,100 $ 1,058 $ 17,158 $ 16,100 $ 2,523 $ 18,623

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As licensing agent, we are responsible for making decisions regarding the prosecution and maintenance of the combined patent portfolio and the licensing and enforcement of the combined patent portfolio in the field of use of DTVs and CDMs on an exclusive basis during the term of the AMSA in exchange for an agent fee.

We were deemed to be the principal in this collaborative arrangement under ASC 808, and, as such, in accordance with ASC 606-10-55-36, Revenue From Contracts with Customers - Principal Agent Considerations , we record revenues generated on sales to third parties and costs incurred on a gross basis in the consolidated statements of income.

We were deemed to be the principal in this collaborative arrangement under ASC 808, and, as such, in accordance with ASC 606-10-55-36, Revenue From Contracts with Customers - Principal Agent Considerations , we record revenue generated on sales to third parties and costs incurred on a gross basis in the consolidated statements of income.

Therefore, we recognize all royalties from customers as revenue and payments to Sony for its royalty share as operating expenses within the consolidated statements of income.

Cost reimbursements for expenses incurred resulting from fulfilling the duties of the licensing agent are recorded as contra expenses.

During the years ended December 31, 2024, 2023, and 2022, gross revenues recorded related to the Madison Arrangement were $ 209.5 million, $ 12.3 million, and $ 14.5 million, respectively.

During the years ended December 31, 2025, 2024, and 2023, gross revenue recorded related to the Madison Arrangement were $ 41.7 million, $ 209.5 million, and $ 12.3 million, respectively.

Net operating expenses related to the Madison Arrangement during the years ended December 31, 2025, 2024, and 2023 were $ 15.7 million, $ 84.1 million and $ 6.2 million, including $ 10.1 million, $ 81.3 million, and $ 3.3 million related to revenue sharing, respectively, and are reflected primarily within " Licensing " expenses in the consolidated statement of income.

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("CPPIB Credit"), a wholly owned subsidiary of Canada Pension Plan Investment Board, is a third-party investor in the Madison Arrangement.

CPPIB Credit has made certain payments to Technicolor and Sony and has agreed to contribute cash to fund certain capital reserve obligations under the arrangement in exchange for a percentage of future revenues, specifically through September 11, 2030 in regard to the Technicolor patents.

Upon our assumption of Technicolor’s rights and obligations under the Madison Arrangement, our relationship with CPPIB Credit met the criteria in ASC 470-10-25, Sales of Future Revenues or Various Other Measures of Income (“ASC 470”), which relates to cash received from an investor in exchange for a specified percentage or amount of revenue or other measure of income of a particular product line, business segment, trademark, patent, or contractual right for a defined period.

CPPIB Credit has made certain payments to Technicolor and Sony and has agreed to contribute cash to fund certain capital reserve obligations under the arrangement in exchange for a percentage of future revenue, specifically through September 11, 2030 in regard to the Technicolor patents.

Upon our assumption of Technicolor’s rights and obligations under the Madison Arrangement, our relationship with CPPIB Credit met the criteria in ASC 470-10-25, Sales of Future Revenue or Various Other Measures of Income (“ASC 470”), which relates to cash received from an investor in exchange for a specified percentage or amount of revenue or other measure of income of a particular product line, business segment, trademark, patent, or contractual right for a defined period.

Under this guidance, we recognized the fair value of our contingent obligation to CPPIB Credit, as of the acquisition date, as long-term debt in our consolidated balance sheet.

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The fair value of the long-term debt as of December 31, 2025 is disclosed within Note 6, " Concentration of Credit Risk and Fair Value of Financial Assets and Financial Liabilities" .

Our repayment obligations are contingent upon future royalty revenues generated from the Madison Arrangement and there are no minimum or maximum payments under the arrangement.

Our repayment obligations are contingent upon future royalty revenue generated from the Madison Arrangement and there are no minimum or maximum payments under the arrangement.

Under ASC 470, amounts recorded as debt shall be amortized under the interest method.

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This rate represents the discount rate that equates the estimated future cash flows with the fair value of the debt as of the acquisition date, and is used to compute the amount of interest to be recognized each period based on the estimated life of the future revenue streams.

During the years ended December 31, 2024 and 2023, we recognized a $ 0.5 million and $ 1.6 million net reduction of interest expense within “ Interest expense ” in the consolidated statements of income due to a change in estimate resulting from updated estimated cash outflows owed under the arrangement, respectively.

During the year ended December 31, 2022, we recognized $ 3.5 million of interest expense related to this debt which is included within “ Interest expense ” in the consolidated statements of income.

During the years ended December 31, 2025 and 2024, we recognized a $ 2.3 million and $ 3.5 million interest expense within “ Interest expense ” in the consolidated statements of income.

During the year ended December 31, 2023, we recognized a $ 1.6 million net reduction of interest expense due to a change in estimate resulting from updated estimated cash outflows owed under the arrangement which is included within “ Interest expense ” in the consolidated statements of income.

Any future payments made to CPPIB Credit, or additional proceeds received from CPPIB Credit, will decrease or increase the long-term debt balance accordingly.

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These plans include a retirement lump sum indemnity plan and jubilee plan, both of which provide benefit payments to employees based upon years of service and compensation levels.

The combined accumulated projected benefit obligation related to these plans totaled $ 4.9 million as of both December 31, 2024 and 2023.

As of December 31, 2025 and 2024, the combined accumulated projected benefit obligation related to these plans totaled $ 5.5 million and $ 4.9 million, respectively.

Service cost and interest cost for the combined plans totaled less than $ 0.5 million in each of the years ended December 31, 2025, 2024, and 2023 and the weighted average discount rate and assumed salary increase rate for these plans were 3.5 % and 3.3 %, respectively .

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Expected future benefit payments under these plans as of December 31, 2025 were as follows (in thousands):

2031-2035 3,100

LITIGATION AND LEGAL PROCEEDINGS

ARBITRATIONS AND COURT PROCEEDINGS

In fourth quarter 2024, the Company reached an agreement with Lenovo Group Limited and certain of its subsidiaries (“Lenovo”) to enter into binding arbitration to determine the final terms of a new paten t license agreement, which will be effective from January 1, 2024.

On November 6, 2024, the Company filed a request for arbitration with the International Chamber of Commerce.

As part of the agreement to arbitrate, both parties agreed to dismiss all pending litigations between them;

the below proceedings have since been dismissed.

UK Proceedings

In August 2019, the Company and certain of its subsidiaries filed a claim in the UK High Court against Lenovo.

The claim, as amended, alleged infringement of five of the Company ’s patents relating to 3G and/or 4G/LTE standards.

The Company sought, among other relief, injunctive relief to prevent further infringement of the asserted patents or, in the alternative, a determination of the terms of a FRAND license.

Between 2021 and 2023, three of the Company’s European Patents were found by UK courts to be valid, essential and infringed by Lenovo.

In March 2023, the UK High Court issued an order staying all deadlines with respect to the fourth and fifth technical trials.

On March 16, 2023, the UK High Court issued its order regarding judgment in the trial to determine how much Lenovo must pay for a license to the Company’s portfolio of cellular assets, awarding the Company a lump sum of $ 138.7 million for such license through December 31, 2023.

On June 27, 2023, the court issued an order awarding the Company an additional $ 46.2 million, thus increasing the total award to $ 184.9 million, which was paid on July 11, 2023.

The court also found that the Company should pay a portion of Lenovo’s costs and granted both parties permission to appeal on certain grounds.

Both parties appealed certain aspects of the ruling, and in July 2024, the UK Court of Appeal ruled in favor of InterDigital and awarded the Company an additional amount of $ 55.2 million to a total of approximately $ 240.1 million.

It rejected Lenovo’s appeal in its entirety and confirmed that Lenovo must pay for all of its past sales starting from 2007 through December 31, 2023.

The court also found that Lenovo should pay the Company’s costs for the appeal and reduced the costs that Lenovo was awarded from the initial decision.

Lenovo sought permission to appeal, and permission to appeal was refused by the UK Court of Appeals.

Lenovo filed an application to the UK Supreme Court requesting permission to appeal in August 2024, which was withdrawn.

On September 24, 2023, Lenovo filed a new claim in the UK High Court, which alleged invalidity of two of the Company’s patents relating to 4G/LTE standards.

Lenovo sought, among other relief, a declaration that the patents at issue were invalid, not essential, and not infringed, revocation of the patents at issue, and a declaration that, upon expiration of the current license in 2023, Lenovo is licensed under terms to be determined by the UK High Court through 2028 or, in the alternative, a determination of the terms of a FRAND license.

In October 2023 , Lenovo filed a request for an order that the Company indicate whether it is prepared to give an unconditional undertaking to enter into a global license on terms set by the UK Court, or failing that, a declaration that the Defendants are unwilling licensors;

a hearing was held in December 2023 during which Lenovo agreed to stay its application.

The Company filed a jurisdiction challenge in October 2023, and a hearing on such challenge took place in April 2024, following which, the jurisdiction challenge was denied.

In November 2023, Lenovo filed an application seeking an expedited FRAND trial and an interim license until a FRAND decision is issued in the UK.

A hearing on the interim license was held in February 2024;

in March 2024 the UK High Court denied Lenovo’s request for the interim license.

A FRAND trial was set for June-July 2025.

District of Delaware Patent Proceedings

In August 2019, the Company and certain of its subsidiaries filed a complaint in the United States District Court for the District of Delaware (the "Delaware District Court") against Lenovo alleging that Lenovo infringes eight of the Company’s U.S.

patents by making, using, offering for sale, and/or selling Lenovo wireless devices with 3G and/or 4G LTE capabilities.

As relief, InterDigital sought:

(a) a declaration that the Company is not in breach of its relevant FRAND commitments with respect to Lenovo;

(b) to the extent Lenovo does not agree to negotiate a worldwide patent license, does not agree to enter into binding international arbitration to set the terms of a FRAND license, and does not agree to be bound by the terms to be set by the UK High Court in the separately filed UK proceedings described above, an injunction prohibiting Lenovo from continued infringement;

and (d) attorneys’ fees and costs.

In June 2023, the parties requested that the entire case be stayed pending resolution of all appeals in the UK proceedings, and this request was granted.

District of Delaware Antitrust Proceedings

In April 2020, Lenovo and Motorola Mobility LLC filed a complaint in the Delaware District Court against the Company and certain of its subsidiaries, alleging that the Company defendants violated Sections 1 and 2 of the Sherman Act in connection with, among other things, their licensing of 3G and 4G standards essential patents ("SEPs").

The complaint further alleged that the Company defendants have violated their commitment to the ETSI with respect to the licensing of 3G and 4G SEPs on FRAND terms and conditions.

The complaint sought, among other things (i) rulings that the Company defendants have violated Sections 1 and 2 of the Sherman Act and are liable for breach of their ETSI FRAND commitments, (ii) a judgment that the plaintiffs are entitled to a license with respect to the Company’s 3G and 4G SEPs on FRAND terms and conditions, and (iii) injunctions against any demand for allegedly excessive royalties or enforcement of the Company defendants’ 3G and 4G U.S.

SEPs against the plaintiffs or their customers via patent infringement proceedings.

In June 2020, the Company filed a motion to dismiss Lenovo’s Sherman Act claims with prejudice, and to dismiss Lenovo’s breach of contract claim with leave to re-file as a counterclaim in the Company’s legal proceeding against Lenovo in the Delaware District Court discussed above.

In March 2021, the Delaware District Court dismissed the Sherman Act Section 1 claim without prejudice, denied the motion to dismiss the Sherman Act Section 2 claim, and consolidated the Section 2 and breach of contract claims with Company’s Delaware patent proceeding discussed above.

United Kingdom Proceedings

In August 2025, Amazon.com, Inc.

and certain of its subsidiaries (“Amazon”) filed a claim in the High Court of Justice of England and Wales against the Company and certain of its subsidiaries.

The claims allege the non-infringement and invalidity of certain patents relating to video coding and video streaming technologies.

Amazon is seeking, among other relief, a rate-setting and order that InterDigital offer Amazon a RAND license as declared by the Court, or a declaration that InterDigital is in breach of its RAND commitment and an unwilling licensor and damages arising from such breach, and a declaration that the challenged patents are invalid and non-essential and not infringed.

The Company made a jurisdictional challenge, which was denied in December 2025.

The Company intends to appeal that decision.

A subset of the issues raised by Amazon’s complaint are scheduled to be tried in September 2026, with the remainder to be scheduled later.

Brazil Proceedings

In September 2025, Amazon filed a claim in the Second Business Court of Sao Paolo (“Sao Paolo Court”) against the Company and certain of its subsidiaries.

The claims allege the non-infringement and non-essentiality of certain patents relating to video coding and video streaming technologies.

Amazon is seeking a declaration that the challenged Brazilian patents are not infringed, and a declaration preventing enforcement by the Company of any video coding patents anywhere in Brazil.

In November 2025, the Company and certain of its subsidiaries filed a claim in the Regional Business Court of Rio de Janeiro against Amazon.

The claim alleges infringement of certain of the Company’s patents relating to video coding technologies.

The Company is seeking, among other relief, damages and injunctive relief to prevent further infringement of the asserted patents.

DE Proceedings

In November and December 2025, the Company and certain of its subsidiaries filed patent infringement claims in three separate proceedings in the Munich and Mannheim Regional Courts against Amazon.

The claims allege infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

Trials are expected in two of the three proceedings in third quarter and fourth quarter 2026.

UPC Proceedings

In November and December of 2025, the Company and certain of its subsidiaries filed patent infringement claims in three separate proceedings in the Mannheim Local Divisional Court and Dusseldorf Local Divisional Court of the UPC against Amazon.

The claims allege infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

International Trade Commission and Companion District Court Proceedings

In September 2023, the Company and certain of its subsidiaries filed a complaint in the United States International Trade Commission (the "International Trade Commission") alleging that Lenovo infringes five of the Company’s U.S.

patents by making, using, offering for sale, and/or selling certain electronic devices , including smartphones, computers, tablet computers, and components thereof that infringe certain claims of the asserted patents.

In November 2025, the Company and certain of its subsidiaries filed a companion patent infringement complaint against Amazon in the Federal District Court of the District of Delaware.

The claims allege infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

In December 2025, the Company and certain of its subsidiaries filed a complaint in the United States International Trade Commission alleging that Amazon infringes the same of the Company’s five patents asserted in the companion case by making, using, offering for sale, and/or selling certain video-capable electronic devices like smart TVs, streaming devices, tablets and smart display devices, and components thereof that infringe certain claims of the asserted patents.

As relief, the Company sought:

(a) a limited exclusion order against Lenovo barring from entry into the United States all of Lenovo’s products that infringe the asserted patents;

(b) cease and desist orders prohibiting Lenovo from importing, selling, offering for sale, marketing, advertising, and distributing, infringing products;

(a) a limited exclusion order against Amazon barring from entry into the United States all of Amazon’s products that infringe the asserted patents;

(b) cease and desist orders prohibiting Amazon from importing, selling, offering for sale, marketing, advertising, and distributing, infringing products;

and (c) a bond during the 60-day Presidential review period.

An evidentiary hearing was held in August 2024.

Also in September 2023, the Company and certain of its subsidiaries filed a complaint in the United States District Court for the Eastern District of North Carolina (the "North Carolina District Court") alleging that Lenovo infringes those same five of the Company’s U.S.

As relief, the Company sought :

(a) a finding that Lenovo is liable for infringement of the asserted patents;

(b) an injunction against further infringement;

and (d) costs.

Germany Proceedings

In September 2023, the Company filed a complaint with the Munich Regional Court against Lenovo and certain of its affiliates, alleging infringement of a European patent relating to cellular 4G/LTE and/or 5G standards.

The Company sought, among other relief, injunctive relief to prevent further infringement of the asserted patents.

In May 2024, the Munich Regional Court issued a judgment finding Lenovo infringed the Company’s European patent and that the Company complied with its FRAND obligations while Lenovo did not;

the Court ordered Lenovo to cease and desist selling infringing products.

The Company served Lenovo with an enforcement note of the judgment in May 2024.

Lenovo appealed the judgment and requested a stay of the enforcement of the judgment, and in June 2024, the Munich Regional Court rejected Lenovo’s request.

OPPO, OnePlus and realme

In fourth quarter 2024, the Company entered into a license agreement with Guangdong OPPO Mobile Telecommunications Corp., Ltd.

(“OPPO”) and certain of its subsidiaries and affiliates.

As part of the license agreement, both parties agreed to dismiss all pending litigations between them;

the below proceedings have since been dismissed.

UK Proceedings

In December 2021, the Company filed a patent infringement claim in the UK High Court against OPPO and certain of its affiliates, OnePlus Technology (Shenzhen) Co., Ltd.

(“ OnePlus ”) and certain of its affiliates, and realme Mobile Telecommunications (Shenzhen) Co., Ltd.

(“realme”) and certain of its affiliates, alleging infringement of the Company’s European patents relating to cellular 3G, 4G/LTE or 5G standards.

The Company was seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

In March 2023, the parties agreed to stay all technical trials.

The FRAND trial to determine the royalties to be paid under the license with OPPO was held in March and April 2024;

a second hearing was held in September 2024 regarding the parties’ submissions relating to the UK Court of Appeal ’s decision in the Lenovo litigation.

India Proceedings

In December 2021, the Company and certain of its subsidiaries filed patent infringement claims in the Delhi High Court in New Delhi, India against OPPO and certain of its affiliates, OnePlus and certain of its affiliates, and realme Mobile Telecommunication (India) Private Limited, alleging infringement of certain of the Company’s Indian patents relating to cellular 3G, 4G/LTE, and/or 5G, and HEVC standards.

The Company was seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

In February 2024, the Delhi High Court granted the Company’s application for pro tem security, and OPPO appealed.

Evidentiary trial proceedings began in October 2024 and were expected to take place through December 2024.

Eastern District of Virginia Proceedings

In December 2025, the Company and certain of its subsidiaries filed a claim in the Federal District Court of the Eastern District of Virginia against Amazon.

The claim alleges infringement of four of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, damages to prevent further infringement of the asserted patents.

US Central District of California Proceedings

In February 2025, the Company and certain of its subsidiaries filed a claim in the Federal District Court of the Central District of California against The Walt Disney Co.

and certain of its subsidiaries (“Disney”).

The claim alleges infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, damages to prevent further infringement of the asserted patents.

In March 2025, Disney filed an answer and asserted multiple counterclaims against the Company.

In April 2025 Disney filed a motion for an anti-suit injunction to prevent enforcement of any potential injunctive relief in Brazil, which the court denied.

A trial is scheduled for September 2026.

Brazil Proceedings

In February 2025, the Company and certain of its subsidiaries filed a claim in the Regional Business Court of Rio de Janeiro against The Walt Disney Co.

and certain of its subsidiaries.

The claim alleges infringement of certain of the Company’s patents relating to video coding technologies.

The Company is seeking, among other relief, damages and injunctive relief to prevent further infringement of the asserted patents.

In March 2025, Disney filed an answer and asserted a rate-setting counterclaim.

In May 2025, the Company requested an anti-interference injunction to prevent Disney from continuing with its anti-suit injunction in California.

In September 2025, the Court granted the Company’s preliminary injunction request.

The Appellate Court initially granted Disney’s request to stay the preliminary injunction pending hearing of an appeal, but that stay was lifted.

Disney had until November 30, 2025, to comply fully with the injunction.

In October 2025, the Company filed another claim in the Regional Business Court of Rio de Janeiro against The Walt Disney Co.

and certain of its subsidiaries.

The claim alleges infringement of one of the Company’s patents relating to video coding technologies.

The Company is seeking, among other relief, damages and injunctive relief to prevent further infringement of the asserted patent.

Germany Proceedings

In December 2021, a subsidiary of the Company filed three patent infringement claims, two in the Munich Regional Court and one in the Mannheim Regional Court, against OPPO and certain of its affiliates, OnePlus and certain of its affiliates, and realme and certain of its affiliates, alleging infringement of certain of the Company’s European patents relating to cellular 3G, 4G/LTE and/or 5G standards.

The Company was seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

The Munich Regional Court held hearings in March and December 2023, and in December 2023, the Munich Regional Court issued a decision finding infringement and issuing an injunction against OPPO.

OPPO appealed this decision.

In March and November 2023, the Munich Regional Court entered stays of the proceedings in respect of specific patents.

China Proceedings

In January 2022, the Company was informed that OPPO had purportedly filed a complaint against the Company in the Guangzhou Intellectual Property Court (the “Guangzhou IP Court”) seeking a determination of a global FRAND royalty for the Company’s 3G, 4G, 5G, 802.11 and HEVC SEPs.

In May 2022, the Company filed an application challenging, among other things, process of service and the jurisdiction of the Guangzhou IP Court.

The Guangzhou IP Court denied the application, and the Company appealed that decision.

The Supreme People’s Court denied the appeal, and an initial evidentiary hearing was held in October 2023.

Spain Proceedings

In March 2022, a subsidiary of the Company filed patent infringement claims in the Barcelona Commercial Courts against OPPO and certain of its affiliates, OnePlus and certain of its affiliates, and realme and certain of its affiliates.

The Company filed an amended complaint in April 2022, alleging infringement of certain of its European patents relating to cellular 3G, 4G/LTE and/or 5G standards.

The Company was seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

Evidentiary trial proceedings were scheduled to take place in May 2025.

In February and April of 2025, the Company and certain of its subsidiaries filed patent infringement claims in four separate proceedings in the Munich Regional Court against The Walt Disney Co.

and certain of its subsidiaries.

The claims allege infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

In October 2025, the Court held a hearing and issued an order finding validity of and infringement by Disney of one of the Company’s patents.

The order enjoined Disney from further infringement.

Disney is currently appealing the Court’s determinations.

In January 2026, the Court imposed fines of € 550,000 for Disney’s violations of the injunction following a request for coercive measures from the Company.

In November 2025, the Court held another hearing and issued another order finding infringement by Disney of another of the Company’s patents.

The order also enjoined Disney from further infringement.

Hearings on the remaining two asserted patents have been scheduled for February 2026.

UPC Proceedings

In February and April of 2025, the Company and certain of its subsidiaries filed patent infringement claims in four separate proceedings in the Mannheim Local Divisional Court and Dusseldorf Local Divisional Court of the UPC against The Walt Disney Co.

and certain of its subsidiaries.

The claims allege infringement of certain of the Company’s patents relating to video coding and video streaming technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

The Mannheim Court has scheduled a hearing for one of the two asserted patents in May 2026 with the remainder to be scheduled in the second half of 2026.

The Dusseldorf Court has scheduled hearings for two asserted patents in June and July 2026.

Delaware Proceedings

In August 2025, a subsidiary of Disney filed an antitrust complaint against the Company and certain of its subsidiaries, and Technicolor in the Federal District Court of the District of Delaware.

The claims allege the Company has engaged in monopolistic conduct in the licensing of its patents relating to video coding and video streaming technologies.

Disney is seeking, among other relief, injunctive relief to halt the licensing practices it views as unlawful, and damages.

In September 2025, the Company filed a motion to dismiss Disney’s complaint, or in the alternative, stay the case pending resolution of the Company’s cases against Disney in California, Europe, and Brazil.

In October 2025, the Antitrust Division of the United States Department of Justice filed a Statement of Interest in the Delaware case.

In fourth quarter 2024, the Company reached an agreement with Lenovo Group Limited and certain of its subsidiaries (“Lenovo”) to enter into binding arbitration to determine the final terms of a new patent license agreement, which will be effective from January 1, 2024.

In November 2024, the Company filed a request for arbitration with the International Chamber of Commerce.

In March 2025, the International Chamber of Commerce confirm ed the full tribunal for the arbitration.

The Company anticipates that the arbitration hearing will occur before year end.

The Company reached an agreement with Samsung Electronics Co.

(“Samsung”) to enter into binding arbitration to determine the final terms of a renewed patent license agreement to certain of the Company’s patents, which will be effective from January 1, 2023.

The Company and Samsung have also agreed not to initiate certain claims against the other during the arbitration.

On March 31, 2023, the Company filed a request for arbitration with the International Chamber of Commerce.

On July 21, 2023, the International Chamber of Commerce confirmed the full tribunal for the arbitration.

The two-week arbitration hearing was held in July 2024 , and closing arguments were held on October 23, 2024.

We expect a decision in early 2025.

On December 5, 2023, Tesla and certain of its subsidiaries filed a claim in the UK High Court against the Company and Avanci.

(“Samsung”) to enter into binding arbitration to determine the final terms of a renewed patent license agreement to certain of the Company’s patents, to be effective from January 1, 2023.

In July 2025, a panel of International Chamber of Commerce arbitrators determined the royalties of the patent license between the Company and Samsung covering Samsung’s products other than digital televisions and computer display monitors, which have been licensed under a separate agreement.

The panel set the total royalties at $ 1.05 billion for the eight -year patent license.

In December 2025, Samsung filed a request to the International Chamber of Commerce seeking to challenge the previously determined royalties.

In December 2023, Tesla and certain of its subsidiaries filed a claim in the UK High Court against the Company and Avanci.

The claim alleges invalidity of three of the Company’s patents relating to 5G standards:

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Tesla sought, among other relief, a declaration that the patents at issue are invalid, not essential, and not infringed, revocation of the patents at issue, a declaration that the terms of the Avanci 5G Connected Vehicle platform license are not FRAND, and a determination of FRAND terms for a license between Tesla and Avanci covering its Avanci’s 5G Connected Vehicle platform.

On March 8, 2024, the Company filed a jurisdiction challenge;

the jurisdiction challenge was heard on May 24-25 and June 4, 2024, and on July 15, 2024 the UK High Court issued a judgment dismissing Tesla’s FRAND claims against the Company and Avanci, and maintaining Tesla’s patent claims against the Company.

The patent claims against the Company were further stayed by the UK High Court, and a hearing on costs and permission to appeal was held on July 30, 2024.

On July 16, 2024, Tesla sought permission to appeal the decision;

the Company also sought permission to appeal on two limited grounds conditionally, should Tesla’s request for an appeal be granted.

The appeal hearing was held on December 2-3, 2024.

In February 2025, the Company and certain of its subsidiaries filed claims in various courts in the United States, Germany, Brazil and at the Unified Patent Court (UPC) against The Walt Disney Company, including Disney+, Hulu and ESPN+, alleging infringement of certain of the Company’s video coding, high dynamic range, and implementation patents.

In March 2024, the Company filed a jurisdiction challenge;

the jurisdiction challenge was heard during May and June 2024, and in July 2024 the UK High Court issued a judgment dismissing Tesla’s FRAND claims against the Company and Avanci, and maintaining Tesla’s patent claims against the Company.

The patent claims against the Company were further stayed by the UK High Court.

An appeal hearing was held in December 2024, and the UK Court of Appeal upheld the lower court's decision and refused Tesla’s request for permission to appeal.

Tesla filed an application for permission to appeal to the Supreme Court.

In July 2025, the Supreme Court granted Tesla’s request for permission to appeal the issues of whether pool licenses are arguably required to be FRAND, whether all members of the Avanci 5G Platform must be joined to the case, and whether Tesla’s claim advances the possibility of a bilateral license from the Company.

In September 2025, the Company filed an application for permission to cross-appeal.

The Supreme Court is set to hear the appeal in April 2026.

UPC Proceedings

In September 2025, the Company and certain of its subsidiaries filed patent infringement claims in the Munich Local Divisional Court of the UPC against Transsion Holdings Pvt Ltd and certain of its subsidiaries (“Transsion”).

The claims allege infringement of certain of the Company’s patents relating to cellular SEP technologies and video coding and video technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents.

India Proceedings

In September and October 2025, the Company and certain of its subsidiaries filed patent infringement claims in the Delhi High Court against Transsion.

The claims allege infringement of certain of the Company’s patents relating to cellular SEP technologies and video coding and video technologies.

The Company is seeking, among other relief, injunctive relief to prevent further infringement of the asserted patents, damages, and a declaration that the Company is FRAND compliant and that Transsion is an unwilling licensee with respect to the FRAND claims.

Brazil Proceedings

In September 2025, the Company and certain of its subsidiaries filed a claim in the Regional Business Court of Rio de Janeiro against Transsion.

The claim alleges infringement of certain of the Company’s patents relating to cellular SEP technologies.

The Company is seeking, among other relief, damages and injunctive relief to prevent further infringement of the asserted patents.

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We use a variety of compensation programs to attract, retain and motivate our employees, and to more closely align employee compensation with company performance.

These programs include, but are not limited to, short-term incentive awards tied to performance goals, cash awards to inventors for filed patent applications and patent issuances, and long-term incentives in the form of stock option awards, time-based RSU awards, performance-based RSU awards and cash awards.

Our long-term incentives typically include annual time-based RSU grants or cash awards with a three-year vesting period, as well as annual performance-based RSU grants or cash awards with a three to five-year performance period;

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On June 11, 2025, our shareholders adopted and approved the 2025 Equity Incentive Plan (the "2025 Plan"), under which officers, employees, non-employee directors and consultants can receive share-based awards such as RSUs, restricted stock and stock options as well as other stock or cash awards.

The plan was amended in order to reserve an additional 1.8 million shares of our common stock for issuance under the 2017 Plan.

Such amendment was adopted and approved by our shareholders on June 2, 2021.

Upon the adoption of the 2017 Plan, the 2009 Stock Incentive Plan was terminated and all shares remaining available for grant under the 2009 Plan were canceled and rolled into the 2017 Plan.

The number of shares available for issuance under the 2017 Plan, as amended, is equal to 4.2 million shares plus any shares subject to awards granted under the 2009 Plan that, on or after June 14, 2017, expire or otherwise terminate without having been exercised in full, or that are forfeited to or repurchased by us.

RSUs and Restricted Stock

Subject to the adjustment provisions contained in the 2025 Plan, as of the effective date of the 2025 Plan, the maximum number of shares for issuance under the 2025 Plan equal to 3.7 million shares of our common stock.

Upon adoption of the 2025 Plan by shareholders, the 2017 Equity Incentive Plan (the "2017 Plan") was terminated and no new awards are granted under the 2017 Plan after June 11, 2025.

We may issue RSUs to officers, employees, non-employee directors and consultants.

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Time-based RSUs vest over periods generally ranging from one to three years from the date of the grant.

Performance-based RSUs generally have a vesting period between two and five years .

Milestone performance-based RSUs may vest at any time, upon achievement of the milestone goal, during the performance period, which is typically five years .

Performance-based RSUs also generally have a vesting period between three and five years.

Milestone performance-based RSUs may vest at any time upon achievement of the milestone goal during the performance period, which is seven years for the most recent CEO award.

As of December 31, 2025, we had unrecognized compensation cost related to share-based awards of $ 41.8 million, at current performance accrual rates.

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Vesting of performance-based RSU awards is subject to attainment of specific goals established by the Human Capital Committee of the Board of Directors.

Depending upon performance achievement against these goals, the number of shares that vest can be anywhere from 0 to 3 times the target number of shares.

Depending upon performance achievement against these goals, the number of shares that generally vest can be anywhere from 0 to 2 times the target number of shares.

Information with respect to current RSU activity is summarized as follows (in thousands, except per share amounts):

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Balance at December 31, 2025

1,154 $ 79.40

* These numbers include fewer than 0.1 million RSUs credited on unvested RSU awards as dividend equivalents.

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The 2017 Plan allowed, and the 2025 Plan allows, for the granting of incentive and non-qualified stock options, as well as other securities.

The administrator of the Equity Plans, the Human Capital Committee of the Board of Directors, determines the number of options to be granted, subject to certain limitations set forth in the 2017 Plan.

We grant stock options to a limited number of the employee base annually as part of our long-term incentive programs, which have generally vested over three years .

During the year ended December 31, 2018, performance-based options were granted for the first time.

The number of performance-based options which vest, if at all, is anywhere from 0 to 3 times the target number of options subject to the attainment of performance goals measured either during or at the end of the performance period.

Performance-based options typically have a vesting period between two and five years .

Milestone performance options may vest at any time, upon achievement of the milestone goal, during the performance period, which is typically five years .

We grant performance-based stock options to our CEO annually as part of our long-term incentive program.

Performance-based options typically have a vesting period between three and five years .

Milestone performance-based options may vest at any time upon achievement of the milestone goal during the performance period, which is seven years for the most recent CEO award.

Vesting of performance-based option awards is subject to attainment of specific goals established by the Human Capital Committee of the Board of Directors.

Depending upon performance achievement against these goals, the number of performance-based stock options that generally vest can be anywhere from 0 to 2 times the target number of stock options.

Under the terms of the Equity Plans, the exercise price per share of each option, other than in the event of options granted in connection with a merger or other acquisition, cannot be less than 100 % of the fair market value of a share of common stock on the date of grant.

Options granted under the Equity Plans are generally exercisable for a period of between seven to ten years from the date of grant and may vest on the grant date, another specified date, over a period of time and/or dependent upon the attainment of specified performance goals.

We also have less than 0.1 million options outstanding under a prior stock plan that do not expire.

Options granted under the Equity Plans are generally exercisable for a period of ten years from the date of grant and may vest upon the attainment of specified performance goals.

The fair value for option awards is computed using the Black-Scholes pricing model, whose inputs and assumptions are determined as of the date of grant and which require considerable judgment.

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As of December 31, 2025, we had unrecognized compensation cost on our unvested stock options of $ 5.2 million, at current performance accrual rates.

As of December 31, 2024 and 2023, we had approximately 0.9 million and 0.7 million options outstanding, respectively, that had exercise prices less than the fair market value of our stock at the respective balance sheet date.

As of both December 31, 2025 and 2024, we had approximately 0.9 million options outstanding that had exercise prices less than the fair market value of our stock at the respective balance sheet date.

These options would have generated cash proceeds to the Company of $ 78.8 million and $ 73.0 million, respectively, if they had been fully exercised on those dates.

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Net operating losses $ 91,486 $ 95,751

Deferred revenue, net 46,073 48,590

Capitalized research and development 40,438 29,432

Deferred revenue, net 36,813 46,073

Amortization and depreciation 23,097 22,707

Tax credit carryforward

Debt amortization 5,863 9,334

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$ 141,549 $ 128,154

The following is a reconciliation of income taxes at the federal statutory rate with income taxes recorded by the Company for the years ended December 31, 2024, 2023 and 2022:

The following is a reconciliation of effective tax rates at the federal statutory tax rate recorded by the Company for the years ended December 31, 2025, 2024, and 2023:

Year Ended December 31,

2025 2024 2023

statutory rate 21.0 % 21.0 % 21.0 %

Non-deductible officers' compensation 1.5 % 1.4 % 1.5 %

Global Intangible Low-Taxed Income

federal statutory tax rate $ 98,553 21.0 % $ 90,148 21.0 % $ 49,268 21.0 %

State and local income taxes, net of federal income tax effect (a)

( 6 ) — % 399 0.1 % 434 0.2 %

Effect of rates different than statutory 0.8 % ( 0.8 ) % ( 0.1 ) %

State tax provision 0.1 % 0.2 % 1.1 %

Uncertain tax positions 0.1 % ( 0.4 ) % 1.5 %

Non-creditable withholding taxes — % 0.1 % 0.4 %

Other permanent differences ( 0.2 ) % 0.5 % 0.7 %

Research and development tax credits ( 0.4 ) % ( 0.6 ) % ( 1.7 ) %

Change in valuation allowance (a)

Foreign Tax Effects

Changes in valuation allowances ( 1,157 ) ( 0.3 ) % ( 2,764 ) ( 0.6 ) % ( 5,222 ) ( 2.2 ) %

Other ( 947 ) ( 0.2 ) % 2,140 0.5 % ( 2,404 ) ( 1.0 ) %

Foreign withholding taxes 63,811 13.6 % 10,456 2.4 % 4,591 2.0 %

Foreign withholding taxes 25,624 5.4 % 17,061 4.0 % 9,965 4.2 %

136 — % 23 — % ( 6 ) — %

Share-based compensation

Other foreign jurisdictions 799 0.2 % 1,246 0.3 % 2,187 0.9 %

Effect of Cross-Border Tax Laws

Global Intangible Low-Taxed Income 777 0.2 % 5,095 1.2 % 812 0.3 %

Foreign-Derived Intangible Income ( 30,308 ) ( 6.5 ) % ( 23,042 ) ( 5.4 ) % ( 16,734 ) ( 7.1 ) %

Foreign tax credit on withholding taxes ( 90,708 ) ( 19.3 ) % ( 29,137 ) ( 6.8 ) % ( 16,593 ) ( 7.1 ) %

1,754 0.4 % — — % — — %

Foreign derived intangible income deduction ( 5.4 ) % ( 7.1 ) % ( 5.3 ) %

Research and development tax credit ( 2,354 ) ( 0.5 ) % ( 1,673 ) ( 0.4 ) % ( 1,313 ) ( 0.6 ) %

Change in valuation allowance — — % ( 8 ) — % — — %

Nontaxable or Nondeductible Items

Share-based compensation ( 15,036 ) ( 3.2 ) % ( 4,448 ) ( 1.0 ) % ( 2,973 ) ( 1.3 ) %

Non-deductible officers' compensation 10,755 2.3 % 6,612 1.5 % 3,260 1.4 %

Other 1,292 0.3 % 576 0.1 % 1,591 0.7 %

Changes in unrecognized tax benefits 436 0.1 % 419 0.1 % ( 889 ) ( 0.4 ) %

Other ( 633 ) ( 0.1 ) % ( 2,301 ) ( 0.5 ) % ( 2,417 ) ( 1.0 ) %

Total tax provision

$ 62,788 13.4 % $ 70,802 16.5 % $ 23,557 10.0 %

(a) In 2024 and 2023, the Company recorded a partial release of the valuation allowance it has in France due to income projected driven by recently signed agreements.

(a) State taxes in Massachusetts & Delaware made up the majority (greater than 50%) of the tax effect in this category

Income Tax Reform

The One Big Beautiful Bill Act (the “OBBBA”) was signed into law on July 4th, 2025.

The OBBBA contains significant tax law changes with various effective dates affecting business taxpayers.

Among the tax law changes that will impact the Company relate to the timing and amount of certain tax deductions including FDII, depreciation expense, R&D expenditures and interest expense.

The tax law changes did not have an impact on the tax provision in 2025.

Valuation Allowances and Net Operating Losses

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We also maintain a valuation allowance against certain temporary differences other than the net operating losses in these jurisdictions.

At December 31, 2024, we had $ 8.7 million in U.S net operating loss carryforwards, which can be indefinitely carried forward, as well as non-U.S.

At December 31, 2025, we had no U.S net operating loss carryforwards and non-U.S.

net operating loss carryforwards amounting to $ 89.7 million which can be indefinitely carried forward under French statutes.

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state net operating loss carryforwards of $ 1.3 billion, of which $ 27.7 million can be indefinitely carried forward, while the remaining $ 1.3 billion will expire in varying amounts from 2026 to 2045.

We had $ 10.1 million of foreign tax credit carried forward that will expire in 2035 and $ 0.7 million of R&D credit carried forward that will expire in 2045.

The Company recognizes deferred tax balances related to the undistributed earnings of subsidiaries when it expects that it will recover those undistributed earnings in a taxable manner, such as through receipt of dividends or sale of the investments.

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The total amount of unrecognized tax benefits could change within the next twelve months for a number of reasons including audit settlements, tax examination activities and the recognition and measurement considerations under this guidance.

During 2024, we reduced the reserve previously established for the amended returns by $ 0.7 million for the benefit available in the current year had it not been included on the amended returns.

During 2023, we reduced the reserve previously established for the amended returns by $ 0.7 million for the benefit available in the current year had it not been included on the amended returns and reduced the reserve previously recorded for foreign withholding taxes by $ 1.1 million due to favorable guidance from the taxing authorities in the United States.

During 2022, we established reserves of $ 1.1 million related to uncertainty arising from our ability to credit foreign withholding taxes in jurisdictions without a tax treaty with the United States.

We also reduced the reserve previously established for the amended returns by $ 1.0 million for the benefit available in the current year had it not been included on the amended returns.

During 2025, 2024 and 2023, we reduced the reserve previously established for the amended returns by $ 0.7 million for the benefit available in the current year had it not been included on the amended returns.

In addition, during 2023 we reduced the previously recorded reserve for withholding tax by $ 1.1 million due to favorable guidance from the taxing authorities in the United States.

The following is a roll forward of our total gross unrecognized tax benefits, which if reversed would impact the effective tax rate, for the fiscal years 2025 through 2023 (in thousands):

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As a result of this agreement, the Company does not anticipate any tax consequences.

In France, where we have substantial operations, we benefit from research tax credits applicable to French technology companies, including the Crédit Impôt Recherche ("CIR").

While we have historically benefited from the CIR, the French government has recently challenged our eligibility for portions of the CIR that they previously accepted.

The Company received notification from the French Tax Authorities that the CIR credit on patent costs has been rejected for tax years 2019 and 2020.

The Company has filed petitions in the Lower Court of Paris to litigate this matter.

Between 2019 and 2025, the Company has recorded benefits totaling approximately $ 29 million for CIR credit on patent related costs.

NET INCOME PER SHARE

Basic Earnings Per Share ("EPS") is calculated by dividing net income available to common shareholders by the weighted-average number of common shares outstanding for the period.

Diluted EPS reflects the potential dilution that could occur if options or other securities with features that could result in the issuance of common stock were exercised or converted to common stock.

The following table reconciles the numerator and the denominator of the basic and diluted net income per share computation (in thousands, except for per share data):

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2025 2024 2023

Net income applicable to common shareholders $ 358,614 $ 214,069 $ 93,693

$ 406,644 $ 358,614 $ 214,069

Weighted-average shares outstanding:

Basic 25,794 25,325 26,860

Dilutive effect of stock options, RSUs, and warrants

1,993 704 379

Dilutive effect of stock options and RSUs 1,168 1,008 704

Dilutive effect of warrants 3,409 985 —

Dilutive effect of convertible securities

4,103 2,393 538

Diluted 34,474 29,711 28,102

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Basic $ 15.77 $ 14.16 $ 7.97

Dilutive effect of stock options, RSUs, and warrants

( 0.87 ) ( 0.19 ) ( 0.04 )

Dilutive effect of stock options and RSUs ( 0.53 ) ( 0.48 ) ( 0.19 )

Dilutive effect of warrants ( 1.56 ) ( 0.47 ) —

Dilutive effect of convertible securities

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Diluted $ 11.80 $ 12.07 $ 7.62

Certain shares of common stock issuable upon the exercise or conversion of certain securities have been excluded from our computation of earnings per share because the strike price or conversion rate, as applicable, of such securities was greater than the average market price of our common stock for the years ended December 31, 2024, 2023 and 2022, as applicable, and, as a result, the effect of such exercise or conversion would have been anti-dilutive.

Set forth below are the securities and the weighted average number of shares of common stock underlying such securities that were excluded from our computation of earnings per share for the periods presented (in thousands):

Shares of common stock issuable upon the exercise or conversion of certain securities have been excluded from our computation of EPS because the strike price or conversion rate, as applicable, of such securities was greater than the average market price of our common stock for the years ended December 31, 2025, 2024 and 2023, as applicable, and, as a result, the effect of such exercise or conversion would have been anti-dilutive.

Set forth below are the securities and the weighted average number of shares of common stock underlying such securities that were excluded from our computation of EPS for the periods presented (in thousands):

Year Ended December 31,

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2015 1,836 96,410

2014 3,554 152,625

Total 18,369 $ 1,241,730

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$ 1.70 $ 43,130

We increased the quarterly cash dividend by $ 0.05 per share in both 2023 and 2024 to raise the dividend payable from $ 0.35 to $ 0.45 per share.

In February 2025, we announced an additional increase in the quarterly cash dividend by $ 0.15 per share, beginning with the quarterly dividend payable in second quarter 2025.

In 2025, we increased the quarterly cash dividend to $ 0.70 per share beginning with the dividend declared in third quarter 2025 and paid in fourth quarter 2025.

Combined with previous increases, we have increased the dividend by 75 % since the start of 2024.

We currently expect to continue to pay dividends in accordance with our dividend policy;

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The Company does not currently have any finance leases.

Certain of our leases include options to extend the lease at our discretion at the end of the lease term, or terminate the lease early subject to certain conditions and penalties.

Certain leases include options to extend the lease at our discretion at the end of the lease term, or terminate the lease early subject to certain conditions and penalties.

We do not include any renewal options in our lease terms for calculating our lease liabilities, as the renewal options allow us to maintain operational flexibility and we are not reasonably certain we will exercise these options.

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For the years ended December 31, 2025, 2024, and 2023, we did not have any sublease income.

Cash paid for amounts included in the measurement of operating lease liabilities for the year ended December 31, 2024 and 2023 was $ 4.1 million and $ 4.4 million, respectively, and was included in net cash provided by operating activities in our consolidated statement of cash flows.

Cash paid for amounts included in the measurement of operating lease liabilities for the years ended December 31, 2025 and 2024 was $ 4.6 million and $ 4.1 million, respectively, and was included in net cash provided by operating activities in our consolidated statement of cash flows.

As of December 31, 2025, the weighted average remaining operating lease term was 4.4 years and the weighted average discount rate used to determine the operating lease liabilities was 6.2 %.

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Present value of lease liabilities $ 17,633

OTHER INCOME (EXPENSE), NET

The amounts included in " Other income (expense), net " in the consolidated statements of income for the year ended December 31, 2024, 2023 and 2022 were as follows (in thousands):

OTHER INCOME, NET

The amounts included in " Other income, net " in the consolidated statements of income for the year ended December 31, 2025, 2024 and 2023 were as follows (in thousands):

Year Ended December 31,

1 unchanged sentence

Interest and investment income $ 40,025 $ 40,395 $ 46,628

Loss on extinguishment of long-term debt — — ( 11,190 )

Other 8,516 ( 5,070 ) 11,184

Other income (expense), net $ 35,325 $ 57,812 $ ( 3,457 )

Interest and investment income is mostly derived from our short-term investments and changes are primarily due changes in the average amounts held in short-term investments and market conditions.

Refer to Note 10, " Obligations, " for further information on the $ 11.2 million loss on extinguishment of long-term debt recognized during the year ended December 31, 2022.

The change in Other was primarily due to fair value adjustments of our investments and pension obligation resulting in $ 5.4 million and $ 12.1 million of net gains in 2024 and 2023, respectively, and $ 2.4 million of net losses in 2022.

Additionally, the change is due to net losses on foreign currency translation arising primarily from euro translation of our foreign subsidiaries of $ 7.9 million and $ 3.9 million in 2024 and 2022, respectively, and a $ 1.0 million foreign currency translation net gain in 2023.

RESTRUCTURING ACTIVITIES

During 2021, we announced that, as a result of a strategic review of our research and innovation priorities, we commenced the process of a collective economic layoff in which we proposed a reduction in force of our research and innovation unit.

We expanded our restructuring efforts to include general and administrative functions largely centered in the U.S.

During 2024 and 2023, we did not recognize any restructuring expenses, and the Company considers the plan to be complete.

We do not anticipate further restructuring charges and no there are no remaining restructuring liabilities.

As part of the Company’s evaluation of its flexible work policy and the impact of returning to the office, the Company evaluated its current office space footprint and its expected needs going forward.

As the result of this evaluation, during 2022, we recognized a $ 2.4 million impairment, comprised of $ 0.4 million of property and equipment and $ 2.0 million of right of use assets, related to the abandonment of portions of three of our leased properties, which was included within “ Restructuring activities ” in the consolidated statement of income.

The restructuring expenses included in " Restructuring activities " in the consolidated statements of income for the years ending December 31, 2024, 2023, and 2022 were as follows (in thousands):

Year Ended December 31,

Other income, net

$ 48,541 $ 35,325 $ 57,812

Asset impairment $ — $ — $ 2,427

Severance and other benefits — — 305

Outside services and other associated costs — — 548

Total $ — $ — $ 3,280

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

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What changed 10-K

Item 8. Financial Statements and Supplementary Data