ADEA

Image source: The Motley Fool. Monday, Aug. 3, 2026 at 5 p.m. ET Vice President and Investor Relations - Chris Chaney President and Chief Executive Officer - Paul Davis Chief Financial Officer - Keith Jones Operator: Good day, everyone. Thank you for standing by. Welcome to Adeia's Second Quarter 2026 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Chris Chaney, Vice President and Investor Relations for Adeia. Chris, please go ahead. Chris Chaney: Good afternoon, everyone. Thank you for joining us as we share with you details of our quarterly financial results. With me on the call today are Paul Davis, our President and CEO; and Keith Jones, our CFO. Paul will share with you some general observations regarding the quarter, and then Keith will give further details on our financial results and guidance. We will then conclude with a question-and-answer period. In addition to today's earnings release, there is an earnings presentation, which you can access along with the webcast in the IR portion of our website. Before turning the call over to Paul, I would like to provide a few reminders. First, today's discussion contains forward-looking statements that are predictions, projections or other statements about future events, which are based on management's current expectations and beliefs and therefore, subject to risks, uncertainties and changes in circumstances. For more information on the risks and uncertainties that could cause our actual results to differ materially from what we discuss today. Please refer to the Risk Factors section in our SEC filings, including our Annual Report on Form 10-K and our quarterly report on Form 10-Q. Please note that the company does not intend to update or alter these forward-looking statements to reflect events or circumstances arising after this call. To enhance investors' understanding of our ongoing economic performance, we will discuss non-GAAP information during this call. We use non-GAAP financial measures internally to evaluate and manage our operations. We have, therefore, chosen to provide this information to enable you to perform comparisons of our operating results as we do internally. We have provided reconciliations of these non-GAAP measures to the most directly comparable GAAP measures in the earnings release, the earnings presentation, and on the Investor Relations section of our website. A recording of this conference call will be made available on the Investor Relations website at adeia.com. Now I'd like to turn the call over to our CEO, Paul Davis. Paul Davis: Thank you, Chris, and thank you, everyone, for joining us today. I'm pleased to share our results for the second quarter of 2026 and our strong performance in the first half of the year. Our second quarter results were in line with our expectations as we delivered revenue of $96 million (sic) [ $96.1 million ] with an adjusted EBITDA margin of 59% (sic) [ 58.7% ]. We had another excellent quarter of cash generation, producing $55 million (sic) [ $54.6 million ] in cash from operations. We ended the quarter with $137 million in cash while executing on all 4 pillars of our capital allocation strategy. We closed 6 license agreements during the quarter and added a record 12 new customers in total. Our first half performance included solid execution across all aspects of our business: closing license agreements with Microsoft, AMD, Google and our recent deal with RPX that further accelerates our e-commerce business. We also continue to invest in growing our leading media and semiconductor portfolios and believe we are well positioned for the long term. The progress we've made to date is in line with our expectations. So we are reiterating our 2026 revenue guidance of $395 million to $435 million. Our non-Pay-TV recurring revenue is strong and thriving, growing 54% year-over-year in the second quarter and is now nearly double the size of our Pay-TV recurring revenue. Despite the known headwinds in Pay-TV, including recent litigation matters, our pipeline is robust, and we are confident in our long-term trajectory. The timing of resolution to any litigation, however, is difficult to predict and thus could impact us in the short term. As we look at the remainder of the year, our diversified and growing pipeline continues to provide multiple paths to achieve our revenue goals for 2026. As we have stated before, we tend to do big deals. And operationally, we lean towards being a relatively small volume, high dollar shop. As always, we will remain disciplined in closing deals that are in the best long-term interest of the company and its stakeholders. Our range of outcomes for the year reflects this approach and will be impacted by the ultimate timing of when we sign license agreements which we continue to have the utmost confidence in being able to do. Importantly, as we have seen in the past, to the extent any opportunities move out of 2026, they provide a springboard for us in the following year. One of our most significant license agreements in the second quarter was a multiyear renewal with Google for access to our media portfolio. Google has been a valued customer for approximately 15 years, and this renewal reflects the continued relevance and strength of our media portfolio for Pay-TV. YouTube TV, which is operated by Google has become one of the most important players in the Pay-TV market with subscriber growth that has dramatically outpaced many of its peers. Its scale and trajectory are a clear demonstration of the ongoing migration from traditional Pay-TV to virtual MVPD services, and our portfolio is well positioned to capture that shift. With the renewal of Google, combined with our Disney agreement signed last year, which includes Hulu + Live TV, we now count 2 of the largest and fastest-growing virtual MVPD platforms in the country as our customers. Also in the second quarter, we made excellent progress in e-commerce, closing the seminal multiyear license agreement with RPX, a leading patent risk solutions company. This unique deal includes 10 participating member companies in a single agreement, giving them a term license to our growing media portfolio of approximately 10,900 patent assets. This deal was driven by our e-commerce technologies, including intelligent search, virtual shopping experiences and consumer engagement across connected platforms. The RPX members include a broad consortium of market leaders across the digital commerce ecosystem spanning apparel, beauty, online marketplaces, delivery networks and enterprise technology platforms. With the progress we've made in the past 2 years. We believe this business can grow over the long term to a size similar to our consumer electronics business, which has been approximately 10% of our total revenue. Other deals signed in the second quarter include a new multiyear license agreement with L'Oreal, a leading cosmetics and personal care company. A new multiyear license agreement with a leading provider of streaming documentary programming and renewals with a leading European Pay-TV provider and a consumer electronics manufacturer in Japan. Renewals are a cornerstone of our business model. With our renewal rate at over 90%, the vast majority of our customers renew with us because we continue to innovate and build positive relationships with them. I am pleased to announce that given the optimism in the trajectory of our business and particularly the semiconductor market, we are raising our long-term revenue target to $600 million from $500 million annually. Let me begin briefly with media and then provide more color on semiconductors. Our growth objective for our media business over the long term remains unchanged at $400 million annually, bolstered by our success in growing market adoption of our technology, we see key verticals such as OTT, e-commerce, consumer electronics, and social media as catalysts for growth. Moving to the semiconductor industry. We continue to see rapid evolution in the market and the increasing demands from AI have induced an unprecedented acceleration in the development and production of highly advanced logic and memory devices. This new super cycle is driving the semiconductor market to reach over $1.5 trillion this year. Hybrid bonding has become a critical enabler of next-generation chip architectures, helping to solve density, performance and thermal management challenges. We are very excited about the opportunities that lie ahead for our semiconductor business given these industry dynamics and increasing need for our technologies. We had previously estimated this opportunity to be $100 million annually, driven by the broader and faster adoption of hybrid bonding we now expect our long-term semiconductor opportunity to reach $200 million annually. Custom and general-purpose logic providers are already or will soon be incorporating hybrid bonding in both enterprise and consumer-related products. Apple, Intel, and Broadcom, all have products ramping into production using hybrid bonding, further building on the momentum from our recent license agreement with AMD. And according to industry reports NVIDIA's Feynman will also incorporate hybrid bonding beginning in 2028. High-bandwidth memory and flash for both enterprise and consumer markets are also incorporating hybrid bonding. We believe hybrid bonding will be a requirement in HBM with 20 or more layers, if not sooner. 3D NAND leaders, SanDisk and Kioxia, both customers of ours, began using hybrid bonding for NAND in 2023, and we believe others will follow as layer counts approach 400. We know broad adoption of hybrid bonding is coming because the capital equipment required is being ordered. To meet demand for these next-generation devices, leading foundries, memory companies and OSATs are planning to spend approximately $125 billion in the near term for advanced packaging, including hybrid bonding. Our investments in semiconductor innovations are coming to fruition and the opportunities in front of us are very exciting. Let me now turn to our efforts to further diversify and grow our recurring revenue. As noted earlier, our non-Pay-TV recurring revenue grew an impressive 54% year-over-year in the second quarter, continuing a multi-quarter trend. I could not be more pleased with this progress. and it is a result of our execution and focus since our separation from Xperi almost 4 years ago. We knew Pay-TV would remain a core part of our business, and we have continued to invest in it. But we also knew, given the secular trends of that industry, we needed to find other avenues of growth. Our teams across R&D, sales and patent portfolio development have executed extremely well to this vision, maintaining our relevance and strength in Pay-TV, while at the same time, impressively growing our business well beyond it. Our IP portfolios are at the foundation of everything we do, and we continue to invest in them strategically. In the second quarter, we completed 6 tuck-in IP portfolio acquisitions for $9.5 million, focused primarily on e-commerce, OTT and imaging. Our portfolio grew to over 14,250 patent assets in the second quarter, up approximately 4% from the first quarter. In total, we have grown our patent portfolios by almost 5,000 patent assets since separation. The vast majority of this growth generated organically. Consistent with our commitment to defending our IP, earlier this quarter, we filed patent infringement claims against Fubo, asserting 4 patents from our media portfolio. We are disappointed we cannot reach acceptable terms for a new license agreement. Our goal, as always, is a business resolution, a license agreement that reflects the underlying value of our IP. I want to be clear that this matter is completely separate from our license agreement with Disney. Fubo represents a distinct opportunity and the litigation has no impact on our license agreement with Disney. I also want to provide a brief update on the CEO search we announced in connection with our first quarter results. The Board's search process is going well. We have engaged a nationally recognized search firm and the Board is actively evaluating candidates. As a reminder, we anticipate announcing a successor by the fourth quarter of this year. In the meantime, I want to reassure our stakeholders that it is business as usual at Adeia, the same strategy, same team and same goals. Our team remains energized and focused on executing our business plan and our pipeline remains strong. I remain fully committed to driving the business toward our goals for 2026. And to position the company for continued long-term success. I am proud of what we have built together, and I remain excited about what lies ahead. Our execution in the second quarter was great across the board and our revenue was in line with expectations. As we look to the second half of the year, our pipeline remains strong across both media and semiconductors, and we are committed to achieving our full year objectives. Our team is building something special at Adeia. And with the tremendous progress we've made, I am confident in our trajectory towards our newly revised long-term $600 million annual goal for revenue. With that, I will turn the call over to Keith. Keith Jones: Thank you, Paul. I'm pleased to be speaking with you today to share details of our second quarter 2026 financial results. During the second quarter, we delivered results that were in line with our expectations. Revenue of $96.1 million was driven by the execution of 6 license agreements across a diverse mix of customers, including OTT and e-commerce, consumer electronics and Pay-TV. Our second quarter was highlighted by our renewal with Google and a new license agreement with RPX in all, we added a record 12 new customers in the quarter. Now I would like to discuss our operating expenses for which I'll be referring to non-GAAP numbers only. During the second quarter, operating expenses were $40.2 million, a decrease of $2.7 million or 6% from the prior quarter. The decrease was primarily due to lower litigation and personnel-related costs. Research and development expenses were essentially flat compared to the prior quarter. Selling, general and administrative expenses decreased $2 million or 10% from the prior quarter, primarily due to lower personnel-related expenses. Litigation expense was $5.3 million a decrease of $639,000 or 11% compared to the prior quarter, primarily driven by lower spending on AMD due to the resolution of litigation in the prior quarter which was partially offset by new litigation matters. Interest expense during the second quarter was $8 million, a decrease of $511,000 primarily due to our debt repayments and due to lower favorable interest rates during the period. Our current effective interest rate, which includes amortization of debt issuance costs, was 7.1%. Other income was $1.7 million and was primarily related to interest earned on our cash and investment portfolio and due to interest income recognized on revenue agreements with long-term billing structures under ASC 606. Our adjusted EBITDA for the second quarter was $56.4 million, reflecting an adjusted EBITDA margin of 58.7%. Depreciation expense for the second quarter was $480,000. Our non-GAAP income tax rate was 21% for the quarter. Our income tax expense consists primarily of federal and state domestic taxes as well as Korean withholding taxes. Now for a few details on the balance sheet. We ended the second quarter with $137.1 million in cash, cash equivalents and marketable securities, and we generated $54.6 million in cash from operations. We made $6.1 million in principal payments on our debt in the second quarter and ended the quarter with a term loan balance of $392.6 million. We repurchased approximately 353,000 shares of our common stock for $10 million bringing the remaining amount available for future repurchases to $140 million under our current stock repurchase program. Our strong financial performance in the second quarter once again allowed us to execute on all 4 pillars of our balanced capital allocation approach. This includes paying down our debt, repurchasing shares, paying our dividend and making tuck-in portfolio acquisitions. We paid a cash dividend of $0.05 per share of common stock. Our Board also approved payment of another $0.05 per share dividend to be paid on September 14 to shareholders of record as of August 24. For 2026, we are reiterating our prior revenue guidance range of $395 million to $435 million. Our pipeline remains strong and reflects the widespread adoption of our technologies across both the media and semiconductor markets. Operating expenses are expected to be in the range of $184 million to $192 million. We expect interest expense to be in the range of $34 million to $36 million. We expect other income to be in the range of $5.5 million to $6.5 million. We expect a resulting adjusted EBITDA margin of approximately 55%. We expect the non-GAAP tax rate to be 21% for the full year. We also expect capital expenditures to be approximately $2 million for the full year. I am truly excited about our future. The increase in our long-term revenue outlook to $600 million annually is a clear reflection of this enthusiasm. We find ourselves at the right place at the right time with the right assets, and our entire team remains dedicated to executing on this goal. That brings it end our prepared remarks. And with that, I'd like to turn the call over to the operator to begin our question-and-answer session. Operator? Operator: [Operator Instructions] Your first question comes from the line of Scott Searle with ROTH Capital. Scott Searle: Nice job in the quarter. Nice to see the semi momentum starting to build. Maybe quickly on that point, Keith, I'm not sure if I heard a number in terms of mix between media and semis. I'm wondering if you could provide that. And then, Paul, just in terms of the opportunity pipeline on the semi front, it seems like it's really started to broaden post the AMD deal as you start to see hybrid bonding being pulled into a lot of different areas within logic that previously hadn't been contemplated. I'm wondering if you could expand upon that in terms of vertically integrated hyperscalers, AI inference, other edge devices that are starting to pull in to give us a little bit more color and understand what the level of engagement is on the semi front. Keith Jones: So just to kind of start off with the breakout between media and semiconductor. Semi was about $14.8 million in revenue for Q2, and if you look on a year-to-date basis, I'm just pleased to say that semi year-to-date is about $48 million of that $200 million number that we posted, so about 24%. So just really good growth. If you compare that to what we were in a full year last year, about $26 million you can clearly see our semi business is headed in a great direction. Paul Davis: Yes, Scott. And then on the pipeline, you got it right. I mean it's really across the board that we're seeing hybrid bonding adoption. I noted some of it on my call with logic players really beyond AMD. AMD was ahead of the curve. As we mentioned before, they started shipping hybrid bonded logic devices in 2022. But now we're seeing it with Broadcom and Intel is ramping, even Apple has chips in production as well. And then there's industry reports that NVIDIA's Feynman in 2028 will incorporate hybrid bonding. So we're very excited about that opportunity. And then you mentioned hyperscalers as well. I've said this publicly a number of times that these hyperscalers are semiconductor companies now. And I believe that they're all focused on differentiating their own products and services with their semiconductor chips. And that's going to create additional opportunity for us. And then lastly, what we're seeing in the NAND market in HBM, the proof is really in what we're seeing in the CapEx build-out. I mentioned $125 billion CapEx build-out for advanced packaging, including hybrid bonding. But also there's reports that Samsung has ordered 50 bonding tools. And so all of this just lines up with what we have been anticipating, which is tremendous adoption of hybrid bonding, which is giving us that confidence in formally increasing our target to $200 million annually, for the semiconductor business, which we are very excited about. Scott Searle: Great. That's very helpful. And maybe shifting gears into the media side of the equation. We've gone through a transition here with DIRECTV and DISH kind of coming out of the numbers. But now it seems like you've got a broadened opportunity pipeline that's more diverse across different customers, different categories. And so I guess the question is, given what you're seeing in the non-Pay-TV revenue and growth, should we expect to see recurring revenue within media now on a growth trajectory that we've kind of absorbed the hits on DIRECTV and DISH? Paul Davis: Yes. I think we are really proud of our non-Pay-TV recurring revenue growth. We -- it's something that we were very strategic about since our separation. We knew, like everybody else knew where the Pay-TV industry was going. We have had some more headwinds because of some of this litigation that we might have not anticipated a few years ago, but this is the diversification play coming into fruition, and you're seeing that really across the board. I think the highlights, I would say, is obviously, OTT, and then e-commerce are big contributors to that growth. but even consumer electronics and social media are contributing as well to that growth. And then we have plans to continue to expand into different adjacent markets on the media side as well, and those are starting to ramp in addition to what we already have contributing with e-commerce. So we're really pleased across the board on that. And I do think we're in a continued growth phase. We've had continued consistent growth since our separation from Xperi where we have built on our non-Pay-TV recurring revenue really quarter-over-quarter. There's occasionally dips just because of deal timing where you'll see that and structure our deals, and then it will ramp back up. But if you look at just a line across the board over the last 4 years, it is up into the right, and we expect that to continue. Scott Searle: Great job. Operator: Your next question comes from the line of Kevin Cassidy with Rosenblatt Securities. Kevin Cassidy: Congratulations on the great results and the better outlook. And speaking of the better outlook, the $100 million extra in semiconductors, I know you haven't given a time frame, but were you thinking that this is within the same time frame that you thought you could get to $100 million in that same time frame, you can get to $200 million? Paul Davis: Yes. That's right, Kevin. I think we talk about -- we call it long term. I think broadly speaking, we think about that in about 5 years, right, is what we think about when we do our long-range planning, and we think that, that is achievable, right, in that time frame now for that $200 million semiconductor target. Again, it's really the catalyst that I just mentioned to Scott, it's both logic and memory. And by memory, I really do mean NAND and HBM. It's not just HBM, which we continue to be very bullish on as we get to 20 layers or so. But NAND, as we get to 400 layers, there's a real need, right, for hybrid bonding for the big 3 memory guys, and we think they're all ramping to get there. And so it's on both sides of their memory businesses, and that's what excites us as well in addition to all the CapEx build-out that we're seeing. Kevin Cassidy: Yes, I'd agree with that with SK Hynix on their second quarter earnings call, they even said that they're preparing next generation in like say -- in addition to hybrid bonding, but they also said at iHBM, they mentioned this as -- and having thermal dissipation, is RapidCool ready for licensing? Or is this something that might be in discussion? Paul Davis: When you think about RapidCool, yes, we think it is part of this catalyst as well. Again, we license on a portfolio-wide basis, right? But 1 of the things that differentiates us from other licensing companies is really the innovation story. And RapidCool is a great thing for us to showcase, right, on that innovation. It's new, it's solving a big problem that the industry is trying to deal with right now. Thermal management, as you know, Kevin, is at the heart of a lot of what these companies are worried about. And we're showing a solution that is -- can be adopted, right? That is not so wild that it creates some totally new ecosystem. It's -- as I've mentioned before, it's plug and play in these current data centers, right, and it uses existing equipment. And so yes, we think it can be also a really important element to our relicensing efforts with the memory players, but also in logic as we've talked about before. And so yes, it's part of that story. Hybrid bonding is kind of now. So we focus on that. But RapidCool is definitely an element of that relicensing effort as well as we talk to customers about how our portfolio continues to grow and evolve. Kevin Cassidy: Okay. Great. And maybe I could just ask 1 other question about the tuck-in acquisitions of the IP portfolio. For -- What [indiscernible] IP in semiconductors or media? And did they include any employees or whether it's just patents? Paul Davis: Yes. So as I think we've mentioned before, we're focused on our tuck-in acquisitions really being in all of our growth areas. And so this quarter, it was media focused. So e-commerce, OTT and imaging were the primary technology areas that we acquired in. But we are evaluating semiconductor portfolios in addition to other media growth areas as well. We've got a strong pipeline in our acquisitions. These particular ones were patent focused, but we do remain open to looking at inventive teams and doing acquihires as well as patent acquisitions. That's part of what we evaluate as well. Operator: Your next question comes from the line of Hamed Khorsand with BWS Financial. Hamed Khorsand: Could you just talk about -- a little bit about your sales pipeline or potential deals? And if anything makes you uncomfortable as far as the timing not happening this year, if there's any of those possibilities? Paul Davis: Hamed, first of all, thanks for the question. I think our pipeline is quite robust. I was mentioning to someone just recently. I feel really good about where we are. And if I think about even comparing it to years past, I think we've got an incredibly robust set of opportunities to deliver on our commitments for this year. And it can come from various different avenues, right? And then I think the momentum we are seeing in e-commerce on the heels of our RPX deal is tremendous, for example. But in addition, obviously, the OTT and semiconductor momentum continues on as well. And so when I look forward, there are a number of ways for us to get there. And they include even potentially some of the Pay-TV items that we've got in dispute, which obviously can move the needle quite a bit. But as you know, we are a small volume, high dollar shop, right? And so the good news is this year, we've got more in our path to get there than we have in the past, as I mentioned last quarter, and that continues on. Hamed Khorsand: I guess what I'm trying to get to is, right now, you're on pace for the low end of your revenue guidance range. I'm just trying to understand like what's the outlook to get to the high end? Are you depending on 1 or 2 deals? Paul Davis: One or 2 deals? Sure. I think we've got a number of ways to get within our range. If I look at last year, for example, right, we were at about [ 170 ] at this point. We had 2 quarters of [ 85 ], right? This year, we're at the midpoint, we're at [ 201 ]. So we're in better shape than we were last year. We always tend to be a little back-end loaded in terms of when deals tend to come to fruition. And that's no different this year. It's a little better than it has been in the past, quite frankly. And so we continue to have really good discussions with customers, both on the renewal and new deal front. Keith Jones: And Hamed, I would also add to that, that when I took a look at our internal forecast, our internal forecast looks a lot like the consensus models out there as well. Operator: Your next question comes from the line of Matthew Galinko with Maximum Group (sic) [ Maxim Group ] Matthew Galinko: Maybe, firstly, I think your 2Q operating cash flow number was historically relatively high, and I think it brought you a relatively high cash balance as well. Can you maybe talk about how you are feeling with your current cash balance and cash flow that kind of reached year-to-date and what we might expect through the balance of the year. Keith Jones: Yes. Matt, great question. So actually, if you take a look at that cash where we ended at $137 million, it's actually pretty consistent where we ended at the end of December of last year. And really, we got a couple of things. We had a great start to the year. Typically, Q2 and Q3 are pretty light for us in cash generation from cash from operations. But as you can see, Q2 was very, very, very strong. For the full year, our outlook still is the same in terms of about $150 million or give or take, for the full year, which, once again, kind of going back to Q3 being relatively light. So we'd anticipate cash from operations in Q3 to be fairly modest and then have a resurgence back in Q4. And we also have a good number of commitments as we go through an operator of our business. We have a dividend program we paid down our debt. And last but definitely not least, we are acquisitive. So we built up probably a little bit higher bit of cash, knowing some of those things were coming in light of having a softer or a lighter cash from operations in Q3. So with that being said, our targets are still the same when we -- in the year, in 2026, we anticipate cash being at that $100 million number that we typically target to get to. Matthew Galinko: All right. And maybe as a follow-up, RPX is an interesting counterparty. It's, I think first time I can remember, you announcing a license with RPX. So can you talk a little bit about how the negotiation was there? And do you think there is additional opportunity to license to portions of RPX's client or subscriber base or how should we think about that as a counterparty? Paul Davis: Yes. Thanks, Matt. Yes, we're really pleased with the RPX deal. We do think it is one that we can potentially replicate going forward. It is important to note, though, that it's consistent with our licensing program, right? And so it's term based, right? It is something that we see though as really helpful in terms of when you're looking at so many customers and potential customers that we have in the e-commerce space to really reduce friction potentially, right? And I think RPX was a great partner for us in that regard. I'm not going to get into the details of what the negotiations were, but we're really pleased with our conversations and relationships with RPX. And then we do think that this -- I'll just say the style of the deal can be potentially replicated going forward. I think getting 10 companies essentially under license at 1 time is fantastic for us, right? And something that I think when you look at e-commerce in particular, we started really this business in e-commerce about 2 years ago. We got our first license agreement just at the end of 2024, right? And now it is a significant meaningful contributor to our business and our revenue, and we see it growing pretty significantly from here. And so yes, it's a great deal for us, very pleased with the relationship with RPX and see the deal structure as one that we could replicate moving forward. Operator: That concludes our question-and-answer session. I will now turn the call back over to Chief Executive Officer, Paul Davis, for closing remarks. Paul Davis: Thank you, operator. Once again, I would like to thank our employees for their hard work and dedication and also our shareholders, partners and customers for their ongoing support. Over the next several weeks, we will be participating in the Oppenheimer Annual TMT Conference; the Rosenblatt Age of AI Conference, the Needham Annual Semi and SemiCap Conference and the BWS Investor Conference. We look forward to speaking with you at these and other events. Thank you. Operator: Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect. 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Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved Q2 revenue of $96.1 million, supported by a record 12 new customer additions and the execution of six license agreements. Non-Pay-TV recurring revenue grew 54% year-over-year, now nearly doubling the size of Pay-TV recurring revenue as the company successfully diversifies away from legacy headwinds. Raised long-term annual revenue target from $500 million to $600 million, primarily driven by a doubled outlook for the semiconductor business to $200 million annually. Management identified a 'new super cycle' in semiconductors fueled by AI, where hybrid bonding has become a critical enabler for advanced logic and memory chip architectures. The media business renewal with Google highlights the successful capture of the market shift from traditional Pay-TV to virtual MVPD services like YouTube TV. Strategic entry into e-commerce reached a milestone with a multi-company RPX agreement, which management believes can eventually scale to 10% of total revenue. Maintained a high-value, low-volume operational discipline, prioritizing long-term deal integrity over short-term volume, even if it results in back-end loaded fiscal years. Reiterated 2026 revenue guidance of $395 million to $435 million, supported by a robust pipeline across media and semiconductor verticals. Anticipates semiconductor growth will be driven by broad adoption of hybrid bonding in HBM with 20+ layers and 3D NAND approaching 400 layers. Expects approximately $125 billion in industry-wide near-term CapEx for advanced packaging to serve as a leading indicator for future licensing demand. The CEO search process is expected to conclude with a successor announcement by the fourth quarter of 2026. Guidance assumes a balanced capital allocation strategy including debt repayment, share repurchases, and strategic 'tuck-in' IP acquisitions. Filed patent infringement claims against Fubo after failing to reach acceptable licensing terms, though management clarified this has no impact on the existing Disney agreement. Acknowledged ongoing headwinds in the Pay-TV sector, noting that the timing of litigation resolutions remains difficult to predict and could impact short-term results. Completed six tuck-in IP portfolio acquisitions for $9.5 million in Q2, expanding the total patent asset count to over 14,250. Management noted that while Q3 cash generation is expected to be 'fairly modest' due to deal timing, they maintain a full-year target of approximately $150 million in cash from operations. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed hybrid bonding adoption is broadening to Broadcom, Intel, and Apple, with NVIDIA's Feynman expected to incorporate it by 2028. Hyperscalers are increasingly viewed as semiconductor companies, creating new licensing opportunities as they develop proprietary chips for AI. The $200 million annual semiconductor target is framed within a five-year long-range planning window. Growth is predicated on hybrid bonding becoming a requirement for high-layer count NAND and HBM memory devices. The deal licensed 10 companies simultaneously, effectively reducing friction in the high-growth e-commerce vertical. Management intends to replicate this 'consortium-style' deal structure to accelerate market penetration in adjacent digital commerce sectors. RapidCool is being integrated into relicensing discussions as a 'plug-and-play' solution for data center thermal challenges. While hybrid bonding is the immediate revenue driver, RapidCool serves as a key innovation differentiator for future logic and memory contracts.

This article first appeared on GuruFocus. Revenue: $96.1 million in Q2 2026, in line with expectations. Adjusted EBITDA Margin: 59% for the quarter. Cash from Operations: $54.6 million generated in Q2. Cash Position: Ended Q2 with $137.1 million in cash, cash equivalents, and marketable securities. Operating Expenses: $40.2 million, down 6% from the prior quarter. Litigation Expense: $5.3 million, down 11% from the prior quarter. Interest Expense: $8 million, down $511,000 from the prior quarter. Non-Pay-TV Recurring Revenue Growth: Increased 54% year over year in Q2. Patent Portfolio: Grew to over 14,250 patent assets, up approximately 4% from Q1. IP Portfolio Acquisitions: Completed six tuck-in acquisitions for $9.5 million. Debt Repayment: Made $6.1 million in principal payments, ending Q2 with a term-loan balance of $392.6 million. Share Repurchases: Repurchased approximately 353,000 shares for $10 million. Dividend: Paid $0.05 per share; another $0.05 per share dividend approved. 2026 Revenue Guidance: Reiterated at $395 million to $435 million. 2026 Adjusted EBITDA Margin Guidance: Approximately 55%. Long-Term Revenue Target: Raised to $600 million annually, up from $500 million. Warning! GuruFocus has detected 3 Warning Signs with ADEA. Is ADEA fairly valued? Test your thesis with our free DCF calculator. Release Date: August 03, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Adeia Inc (NASDAQ:ADEA) delivered strong Q2 2026 results with revenue of $96 million and a 59% adjusted EBITDA margin, in line with expectations. Non-Pay-TV recurring revenue grew 54% year-over-year, now nearly double the size of Pay-TV recurring revenue, showcasing successful diversification. Closed six license agreements in Q2, including a multi-year renewal with Google and a seminal deal with RPX covering 10 member companies, adding a record 12 new customers. Raised long-term revenue target to $600 million annually, driven by increased semiconductor opportunity to $200 million due to hybrid bonding adoption. Generated $54.6 million in cash from operations, ending the quarter with $137.1 million in cash, while executing on all four capital-allocation pillars. Semiconductor business is gaining momentum with $48 million in year-to-date revenue, up from $26 million in all of 2025, and strong pipeline across logic and memory. Pay-TV business faces known headwinds, including recent litigation matters, which could impact short-term results. Litigation with Fubo was filed after failing to reach a license agreement, adding uncertainty and potential costs. Revenue guidance for 2026 remains unchanged at $395-$435 million, with timing of deals uncertain and potentially back-end loaded. Operating expenses, while down sequentially, remain significant at $40.2 million in Q2, with litigation costs expected to continue. Cash flow from operations is expected to be modest in Q3, with a resurgence only in Q4, impacting near-term liquidity. The CEO search process is ongoing, with a successor not expected until Q4 2026, creating potential leadership uncertainty. Q: Can you provide the revenue mix between Media and Semiconductor, and expand on the semiconductor opportunity pipeline, particularly regarding hybrid bonding adoption beyond AMD?A: Keith Jones (CFO) noted Semiconductor revenue was $14.8 million in Q2, bringing year-to-date Semi revenue to $48 million, or 24% of the $200 million long-term target, compared to $26 million for all of last year. Paul Davis (CEO) highlighted that hybrid bonding adoption is broadening across logic players including Broadcom, Intel, and Apple, with NVIDIA's Feynman expected to incorporate it in 2028. He also cited a $125 billion CapEx build-out for advanced packaging and reports of Samsung ordering 50 bonding tools, reinforcing confidence in the increased $200 million annual Semiconductor target. Q: Given the transition with DirecTV and DISH, do you expect Media recurring revenue to return to a growth trajectory?A: Paul Davis (CEO) expressed pride in non-Pay-TV recurring revenue growth, which rose 54% year-over-year in Q2 and is now nearly double the size of Pay-TV recurring revenue. He attributed this to strategic diversification since separation from Xperi, with OTT and e-commerce as major contributors, alongside Consumer Electronics and social media. He noted consistent quarter-over-quarter growth over the past four years, with occasional dips due to deal timing, but expects the upward trajectory to continue. Q: Is the increased $200 million Semiconductor target achievable within the same timeframe as the previous $100 million target?A: Paul Davis (CEO) confirmed the $200 million target is achievable within the same roughly five-year long-range planning timeframe. He cited catalysts across both logic and memory, including hybrid bonding adoption in HBM at 20+ layers and NAND at 400 layers, with major memory players ramping. The significant CapEx build-out in advanced packaging further supports this accelerated growth outlook. Q: Is RapidCool ready for licensing, and how does it factor into the semiconductor opportunity?A: Paul Davis (CEO) stated RapidCool is part of the catalyst story and differentiates Adeia through innovation. It addresses thermal management challenges in data centers and is designed as a plug-and-play solution using existing equipment. RapidCool is an important element of relicensing efforts with memory players and logic customers, showcasing how the portfolio continues to grow and evolve. Q: What were the tuck-in IP portfolio acquisitions focused on, and did they include employees?A: Paul Davis (CEO) explained the six tuck-in acquisitions for $9.5 million were Media-focused, primarily in e-commerce, OTT, and imaging. These were patent-focused acquisitions, but the company remains open to acquiring inventive teams (acqui-hires) as well. The portfolio grew to over 14,250 patent assets, up approximately 4% from Q1, with a strong pipeline of additional acquisition opportunities. Q: Can you discuss the sales pipeline and any risks to deal timing for the remainder of 2026?A: Paul Davis (CEO) described the pipeline as robust with multiple paths to achieve 2026 revenue goals, including momentum in e-commerce following the RPX deal, OTT, and Semiconductor opportunities. He noted the company is a small-volume, high-dollar shop and that deals tend to be back-end loaded. Keith Jones (CFO) added that the internal forecast aligns with consensus models, and the company is in better shape than last year at this point, with year-to-date revenue at $201 million versus approximately $170 million in the prior year. Q: How should we think about the cash balance and cash flow expectations for the balance of the year?A: Keith Jones (CFO) noted the $137 million cash balance is consistent with year-end 2025 levels. Q2 cash from operations was very strong at $54.6 million, though Q3 is typically lighter. Full-year cash from operations is still expected to be approximately $150 million, with a resurgence in Q4. The company maintains its capital allocation strategy across dividends, debt paydown, share repurchases, and acquisitions, targeting a year-end cash balance of approximately $100 million. Q: Can you elaborate on the RPX deal and whether this deal structure can be replicated with other consortiums?A: Paul Davis (CEO) expressed enthusiasm for the RPX agreement, which included 10 participating member companies in a single term-based license covering approximately 10,900 patent assets. He noted this deal structure could potentially be replicated, particularly in e-commerce, where it reduces friction with multiple customers. The e-commerce business, which began about two years ago with its first license at the end of 2024, is now a significant and growing contributor to revenue, and the RPX deal represents a seminal milestone in that trajectory. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Adeia (ADEA) came out with quarterly earnings of $0.34 per share, beating the Zacks Consensus Estimate of $0.3 per share. This compares to earnings of $0.25 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +13.33%. A quarter ago, it was expected that this provider of chip technology for small electronic devices would post earnings of $0.36 per share when it actually produced earnings of $0.38, delivering a surprise of +5.56%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Adeia, which belongs to the Zacks Technology Services industry, posted revenues of $96.12 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.04%. This compares to year-ago revenues of $85.74 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Adeia shares have added about 54.5% since the beginning of the year versus the S&P 500's gain of 9.4%. While Adeia has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Adeia was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.35 on $103.76 million in revenues for the coming quarter and $1.43 on $416.74 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Technology Services is currently in the bottom 44% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Peraso (PRSO), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 11. This semiconductor technology company is expected to post quarterly loss of $0.18 per share in its upcoming report, which represents a year-over-year change of +35.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Peraso's revenues are expected to be $1.25 million, down 43.7% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Adeia Inc. (ADEA) : Free Stock Analysis Report Peraso Inc. (PRSO) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Adeia Inc.? Here are five stocks we like better. Adeia reported solid Q2 results, with revenue of $96.1 million, adjusted EBITDA of $56.4 million and a 59% margin. The company reiterated 2026 revenue guidance of $395 million to $435 million and expects approximately $150 million in full-year operating cash flow. Licensing momentum remained strong, with six agreements and 12 new customers, including Google, RPX and L’Oréal. Non-pay-TV recurring revenue increased 54% year over year and is now nearly twice the size of pay-TV recurring revenue. Adeia doubled its long-term semiconductor revenue opportunity to $200 million, citing faster adoption of hybrid bonding in logic and memory markets. Semiconductor revenue reached about $14.8 million in Q2 and $48 million year to date, while the company also reduced debt, repurchased shares and continued its dividend. Two Value Tech Stocks Trading Near a Breakout Level Adeia (NASDAQ:ADEA) reported second-quarter 2026 revenue of $96.1 million and adjusted EBITDA of $56.4 million, producing an adjusted EBITDA margin of 59%. The intellectual-property licensing company said results were in line with its expectations and reiterated full-year revenue guidance of $395 million to $435 million. President and CEO Paul Davis said the company generated $54.6 million in operating cash flow during the quarter and ended the period with $137.1 million in cash equivalents and marketable securities. Adeia closed six licensing agreements and added a record 12 new customers during the quarter, according to the company. → Lost in Space: Why Aerospace Valuations Are Plummeting Right Now Adeia highlighted a multiyear renewal with Google for access to its media portfolio. Davis said Google has been a customer for about 15 years and that the agreement reflects the continuing relevance of Adeia’s technology for pay-TV and virtual multichannel video programming distributor services, including YouTube TV. The company also cited its prior agreement with Disney, which includes Hulu + Live TV, as evidence of its position with major virtual MVPD platforms. → MarketBeat Week in Review – 07/27- 07/31 In e-commerce, Adeia signed a multiyear agreement with patent-risk solutions provider RPX. The arrangement includes 10 participating member companies and provides term licenses to Adeia’s media portfolio of about 10,900 patent assets. Davis said the agreement was driven by e-commerce technologies including intelligent search, virtual shopping experiences and consumer engagement across connected platforms. Other second-quarter agreements included a new multiyear license with L’Oréal, a license with a streaming documentary programming provider, and renewals with a European pay-TV provider and a Japanese consumer-electronics manufacturer. → GE HealthCare Stock Climbs on Vital Diagnostics Demand Davis said the company’s renewal rate exceeds 90%. Non-pay-TV recurring revenue grew 54% year over year in the second quarter and is now nearly twice the size of pay-TV recurring revenue, he said. Adeia identified over-the-top video, e-commerce, consumer electronics and social media as contributors to that growth. Adeia raised its long-term annual revenue objective to $600 million from $500 million. The company maintained its long-term media revenue objective of $400 million annually, while doubling its long-term semiconductor opportunity estimate to $200 million from $100 million. Davis said the higher semiconductor target reflects broader and faster adoption of hybrid bonding, a technology used in advanced chip architectures. He said Apple, Intel and Broadcom have products ramping into production using hybrid bonding, while AMD had previously begun shipping hybrid-bonded logic devices in 2022. The company also sees opportunities in high-bandwidth memory and NAND flash. Davis said Adeia believes hybrid bonding will be required in HBM products with 20 or more layers, potentially sooner, and said NAND manufacturers may need the technology as layer counts approach 400. During the question-and-answer session, Davis said the company generally views its long-term targets through an approximately five-year planning horizon. He said the semiconductor opportunity includes both logic and memory markets, including NAND and HBM. CFO Keith Jones said semiconductor revenue totaled approximately $14.8 million in the second quarter and about $48 million year to date. That compares with approximately $26 million in semiconductor revenue for all of the prior year, he said. On a non-GAAP basis, Adeia’s second-quarter operating expenses were $40.2 million, down $2.7 million, or 6%, from the prior quarter. Jones attributed the decline primarily to lower litigation and personnel-related costs. Litigation expense was $5.3 million, down 11% sequentially, largely because spending related to AMD declined after litigation was resolved in the prior quarter, partially offset by new litigation matters. Interest expense was $8 million, down $511,000 from the prior quarter due to debt repayments and lower variable interest rates. Adeia’s current effective interest rate, including amortization of debt issuance costs, was 7.1%, Jones said. Adeia made $6.1 million in principal debt payments and ended the quarter with a term loan balance of $392.6 million. The company repurchased about 353,000 shares for $10 million, leaving $140 million available under its repurchase program. Adeia paid a quarterly cash dividend of $0.05 per share and said its board approved another $0.05-per-share dividend payable Sept. 14 to shareholders of record Aug. 24. The company completed six tuck-in portfolio acquisitions for $9.5 million, primarily focused on e-commerce, OTT and imaging. Adeia’s patent portfolio rose about 4% sequentially to more than 14,250 patent assets. Davis said the company has added almost 5,000 patent assets since its separation from Xperi, with most of that growth generated organically. For 2026, Adeia continues to expect operating expenses of $184 million to $192 million, interest expense of $34 million to $36 million, other income of $5.5 million to $6.5 million, an adjusted EBITDA margin of about 55%, and a non-GAAP tax rate of 21%. Capital expenditures are expected to be approximately $2 million. Jones said the company still expects roughly $150 million in operating cash flow for the full year, with a relatively modest third quarter followed by a stronger fourth quarter. Adeia expects to end 2026 with about $100 million in cash, he added. Davis said Adeia’s pipeline remains robust across media and semiconductor opportunities, though the timing of license agreements and litigation resolutions can affect near-term results. The company recently filed patent infringement claims against Fubo after failing to reach acceptable terms for a new license agreement. Davis said the litigation is separate from Adeia’s agreement with Disney and does not affect that relationship. The company also said its board expects to name a successor to Davis by the fourth quarter, following an ongoing CEO search supported by a nationally recognized search firm. Adeia Inc (NASDAQ: ADEA) is a technology licensing company that focuses on acquiring, managing and monetizing intellectual property assets in the electronics and communications sectors. The company’s core business involves the strategic purchase of patent portfolios followed by the negotiation of licensing agreements, collaborative partnerships and, where necessary, enforcement actions to generate revenue from those assets. Adeia’s technology coverage spans semiconductor design, data communications, wireless networking, imaging systems and other advanced electronics applications. By assembling a diversified collection of high-value patent families, Adeia works closely with original equipment manufacturers, semiconductor suppliers and service providers across North America, Europe and Asia. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Adeia Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Signed multi-year license renewal with Google, which includes YouTube TV, one of the largest Pay-TV providersSigned multi-year license agreement with RPX, encompassing 10 new e-commerce customersLong-term annual revenue outlook increased to $600 million on the strength of our semiconductor business SAN JOSE, Calif., Aug. 03, 2026 (GLOBE NEWSWIRE) -- Adeia Inc. (Nasdaq: ADEA) (the “Company” or “Adeia”) today announced financial results for the second quarter ended June 30, 2026. “Second quarter revenue of $96 million was in line with our expectations, and we generated $55 million in operating cash flow with a 59% adjusted EBITDA margin,” said Paul E. Davis, chief executive officer of Adeia. “We closed six license agreements during the quarter, across OTT, e-commerce, consumer electronics and Pay-TV. We closed a significant multi-year renewal with Google, which has been a valued licensee for approximately 15 years and whose YouTube TV platform is one of the fastest growing Pay-TV services in the country. We also signed a seminal, multi-year license agreement with RPX, adding 10 new e-commerce customers under a single agreement. With the RPX deal and a new license agreement with L'Oréal, we now have 15 customers across six agreements in e-commerce — a business we built from the ground up over just the past two years. Non-Pay-TV recurring revenue for the quarter grew 54% year-over-year, continuing a multi-quarter trend as our non-Pay-TV pipeline remains robust and continues to grow.” Davis continued, “We are raising our long-term annual revenue outlook to $600 million from $500 million driven by confidence in our semiconductor business being able to reach $200 million in annual revenue. This new semiconductor outlook is based on the trajectory of hybrid bonding adoption across both memory and logic in connection with the AI infrastructure build-out and high-performance computing demand. Our media growth target remains strong at $400 million, supported by continued momentum in OTT, e-commerce, consumer electronics and social media. I am very pleased with the progress we have made in the first half of the year and we remain focused on execution across the business to achieve our goals for the year. Our strategic initiatives remain on track, including increasing our long-term revenue, growing our IP portfolio primarily through our organic innovation engine, maintaining a balanced capital allocation approach and growing our opportunity pipeline.” Second Quarter Financial Highlights Revenue was $96.1 million as compared to $104.8 million in the first quarter of 2026 GAAP diluted earnings per share (EPS) was $0.15 and non-GAAP diluted EPS was $0.34 GAAP net income was $17.4 million and adjusted EBITDA was $56.4 million Cash flow from operations was $54.6 million Paid down $6.1 million on our term loan Repurchased $10.0 million of our common stock Business Highlights Signed six license agreements, adding a record 12 new customers in the quarter Signed a multi-year renewal with Google, which includes YouTube TV, one of the largest Pay-TV providers, for access to our media portfolio Signed a multi-year license agreement with RPX, a leading provider of patent risk management solutions, encompassing 10 new e-commerce customers, for access to our media portfolio Signed a new multi-year license agreement with L'Oréal, a leading cosmetics and personal care company, for access to our media portfolio Signed a new multi-year license agreement with a domestic OTT provider of documentary programming and license renewals with a leading European Pay-TV provider and a consumer electronics manufacturer in Japan, all for access to our media portfolio Capital Allocation During the quarter, the Company made $6.1 million in principal payments towards its term loan, bringing the outstanding balance to $392.6 million as of June 30, 2026. During the quarter, the Company repurchased $10.0 million of its common stock, representing 0.4 million shares and bringing the remaining amount available under its stock repurchase plan to $140.0 million as of June 30, 2026. On June 15, 2026, the Company distributed $5.5 million to stockholders of record on May 26, 2026, for a quarterly cash dividend of $0.05 per share of common stock. The Board of Directors declared a dividend of $0.05 per share, payable on September 14, 2026, to stockholders of record on August 24, 2026. Financial Outlook The Company is reiterating its full year 2026 outlook as follows: Conference Call Information The Company will hold its second quarter 2026 earnings conference call at 2:00 PM Pacific Time (5:00 PM Eastern Time) on Monday, August 3, 2026. To access the call in the U.S., please dial +1 (888) 660-6411, and for international callers, dial +1 (929) 203-0849. All participants should dial in 15 minutes prior to the start of the conference call. The Company also suggests utilizing the webcast link to access the live call and the replay at Q2 2026 Earnings Call Webcast. A live and replay webcast will be available on the Adeia Investor Relations website at https://investors.adeia.com. Safe Harbor Statement This press release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on information available to the Company as of the date hereof, as well as the Company’s current expectations, assumptions, estimates and projections that involve risks and uncertainties. In this context, forward-looking statements often address expected future business, financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “could,” “seek,” “see,” “will,” “may,” “would,” “might,” “potentially,” “estimate,” “continue,” “target,” similar expressions or the negatives of these words or other comparable terminology that convey uncertainty of future events or outcomes. All forward-looking statements by their nature address matters that involve risks and uncertainties, many of which are beyond the Company’s control, and are not guarantees of future results. Forward-looking statements are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements and caution must be exercised in relying on forward-looking statements. Important risk factors that may cause such a difference include, but are not limited to: the Company’s ability to implement its business strategy; the Company’s ability to enter into new and renewal license agreements with customers on favorable terms; the Company’s ability to retain and hire key personnel; uncertainty as to the long-term value of the Company’s common stock; legislative, regulatory and economic developments affecting the Company’s business; general economic and market developments and conditions; the Company’s ability to grow and expand its patent portfolios; changes in technology and development of new technology in the industries in which in which the Company operates; the evolving legal, regulatory and tax regimes under which the Company operates; unforeseen liabilities and expenses; risks associated with the Company’s indebtedness; unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism or outbreak of war or hostilities, natural disasters and global health pandemics, each of which may have an adverse impact on the Company’s business, results of operations, and financial condition. These risks, as well as other risks associated with the Company’s business, are more fully discussed in the Company’s filings with the U.S. Securities and Exchange Commission (“SEC”), including the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. While the list of factors presented here is, and the list of factors presented in the Company’s filings with the SEC are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Causes of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, failure to complete licensing arrangements on anticipated terms and timeline, failure to prevail in litigation we may bring against third parties, financial loss, legal liability to third parties and similar risks, and failure to attract or retain employees, any of which could have a material adverse effect on the Company’s consolidated financial condition, results of operations, liquidity or trading price of common stock. The Company does not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws. About Adeia Inc. Adeia is a leading R&D and intellectual property (IP) licensing company that accelerates the adoption of innovative technologies in the media and semiconductor industries. Adeia’s fundamental innovations underpin technology solutions that are shaping and elevating the future of digital entertainment and electronics. Adeia’s IP portfolios power the connected devices that touch the lives of millions of people around the world every day as they live, work and play. For more, please visit www.adeia.com. Non-GAAP Financial Measures In addition to disclosing financial results calculated in accordance with U.S. Generally Accepted Accounting Principles (GAAP), the Company’s earnings release contains non-GAAP financial measures adjusted, where applicable, for either one-time or ongoing non-cash acquired intangibles amortization charges, costs related to actual or planned business combinations including transaction fees, integration costs, severance, facility closures, and retention bonuses, separation costs, all forms of stock-based compensation, leadership transition costs, loss on debt extinguishment, expensed debt refinancing costs, impairment of intangible assets, impact of certain foreign currency adjustments, discontinued operations and related tax effects. In addition, adjusted EBITDA adjusts for recurring charges of interest expense, income taxes, depreciation and amortization. Management believes that the non-GAAP measures used in this release provide investors with important perspectives on the Company’s ongoing business and financial performance and are helpful to provide investors with an understanding of our core operating results reflecting our normal business operations. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. Our use of non-GAAP financial measures has certain limitations in that the non-GAAP financial measures we use may not be directly comparable to those reported by other companies. For example, the terms used in this press release, such as EBITDA margin, which is defined as EBITDA as a percentage of revenue, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating expenses, non-GAAP net income and non-GAAP diluted earnings per share (EPS) do not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. We seek to compensate for the limitation of our non-GAAP presentation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures in the tables attached hereto. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures. All financial data is presented on a GAAP basis except where the Company indicates its presentation is on a non-GAAP basis. Set forth below are reconciliations of the Company’s reported and forecasted GAAP to non-GAAP financial metrics. Investor Contact: Chris ChaneyVice President, Investor [email protected]

Investors were underwhelmed by the solid earnings posted by Adeia Inc. (NASDAQ:ADEA) recently. We did some digging and actually think they are being unnecessarily pessimistic. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. To properly understand Adeia's profit results, we need to consider the US$25m expense attributed to unusual items. While deductions due to unusual items are disappointing in the first instance, there is a silver lining. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. And that's hardly a surprise given these line items are considered unusual. Assuming those unusual expenses don't come up again, we'd therefore expect Adeia to produce a higher profit next year, all else being equal. That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates. Because unusual items detracted from Adeia's earnings over the last year, you could argue that we can expect an improved result in the current quarter. Because of this, we think Adeia's earnings potential is at least as good as it seems, and maybe even better! And the EPS is up 61% over the last twelve months. Of course, we've only just scratched the surface when it comes to analysing its earnings; one could also consider margins, forecast growth, and return on investment, among other factors. So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. To help with this, we've discovered 2 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in Adeia. Today we've zoomed in on a single data point to better understand the nature of Adeia's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks with significant insider holdings to be useful. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Adeia Inc. recently reported past first-quarter 2026 results showing sales of US$104.77 million and net income of US$22.77 million, while also declaring a US$0.05 per-share dividend and completing a US$10 million share repurchase tranche. On the same day, the company disclosed that long-time CEO Paul E. Davis plans to step down by late 2026, even as Adeia secured new multi-year IP licensing agreements with major partners such as AMD, Microsoft and L’Oréal and reaffirmed its full-year 2026 revenue and net income guidance. Now we’ll examine how these strong license-driven earnings and the planned CEO transition may reshape Adeia’s longer-term investment narrative. The future of work is here. Discover the 32 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. To own Adeia today, you need to believe its IP licensing model can keep generating attractive earnings and cash flow as media and semiconductor markets evolve, while customer and patent concentration remain manageable risks. The latest Q1 2026 results and new licenses with AMD, Microsoft and L’Oréal support the near term catalyst of license driven earnings, and the planned CEO transition does not appear to materially change that story in the short run. The most relevant announcement for this narrative is the reaffirmed 2026 guidance for GAAP revenue of US$395.0 million to US$435.0 million and net income of US$57.2 million to US$80.4 million. Against a backdrop of rising licensing wins and high historical returns on equity, this guidance anchors expectations for how much room Adeia has if a major license renewal slips or a large semiconductor deal proves smaller than hoped. But investors should also be aware that Adeia’s dependence on a handful of large media and semiconductor customers leaves it exposed if even one critical license is renegotiated or lost... Read the full narrative on Adeia (it's free!) Adeia's narrative projects $444.8 million revenue and $101.2 million earnings by 2029. This requires revenue to remain fairly flat each year and an earnings decrease of $9.9 million from $111.1 million today. Uncover how Adeia's forecasts yield a $33.00 fair value, a 20% upside to its current price. Before this news, the most pessimistic analysts were assuming roughly flat revenue near US$435 million by 2029 and earnings around US$89 million, reflecting concern that shrinking legacy media and slower new licensing might offset Adeia’s recent momentum, so it is worth asking whether these fresh Q1 results and new agreements ease those worries or reinforce the idea that outcomes can differ widely from what any one forecast implies. Explore 4 other fair value estimates on Adeia - why the stock might be worth as much as 20% more than the current price! Don't just follow the ticker - dig into the data and build a conviction that's truly your own. A great starting point for your Adeia research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision. Our free Adeia research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Adeia's overall financial health at a glance. Every day counts. These free picks are already gaining attention. See them before the crowd does: AI is about to change healthcare. These 35 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 17 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement. This technology could replace computers: discover 27 stocks that are working to make quantum computing a reality. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ADEA. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]