Adeia Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Third quarter 2026 revenue was $80.2 million, a decrease from $96.1 million in the second quarter of 2026 and $87.3 million in the third quarter of 2025.
• GAAP diluted earnings per share (EPS) was $0.02, compared to $0.08 in the third quarter of 2025.
• Non-GAAP diluted EPS was $0.21, compared to $0.28 in the third quarter of 2025.
• GAAP net income was $2.3 million for the quarter, compared to $8.8 million in the third quarter of 2025.
• Adjusted EBITDA was $36.9 million for the quarter, compared to $50.7 million in the third quarter of 2025.
• Cash flow from operations was $5.1 million for the quarter.
• Total cash, cash equivalents, and marketable securities ended the quarter at $127.7 million, down from $136.7 million at the end of 2025.
• Accounts receivable, net, was $22.4 million, down from $28.6 million at the end of 2025.
• Unbilled contracts receivable increased to $144.9 million (current) and $41.6 million (long-term) from $129.8 million (current) and $49.5 million (long-term) at the end of 2025.
• Deferred revenue increased to $80.9 million ($30.9 million current, $49.9 million long-term) from $69.7 million ($19.7 million current, $49.9 million long-term) at the end of 2025.
• Long-term debt, net, decreased to $359.8 million from $397.5 million at the end of 2025.
• The Company paid down $6.1 million on its term loan during the quarter, bringing the outstanding balance to $386.5 million.

Guidance and Future Outlook:

• The Company reiterated confidence in a long-term annual revenue outlook of $600 million.
• Full-year 2026 revenue guidance was updated to a range of $375.0 million to $415.0 million, down from the prior range of $395.0 million to $435.0 million.
• Management stated that revenue could be impacted by the timing of executing a select few deals, with potential execution beyond the end of the year.
• The Company remains confident in achieving the high-end of the updated revenue guidance range for 2026.
• Updated 2026 GAAP operating expenses guidance is $283.0 million to $289.0 million (prior: $295.0 million to $305.0 million).
• Updated 2026 Non-GAAP operating expenses guidance is $176.0 million to $180.0 million (prior: $184.0 million to $192.0 million).
• Updated 2026 GAAP net income guidance is $52.8 million to $79.2 million (prior: $57.2 million to $80.4 million).
• Updated 2026 Non-GAAP net income guidance is $136.7 million to $164.3 million (prior: $144.2 million to $168.7 million).
• Updated 2026 Adjusted EBITDA guidance is $201.1 million to $237.1 million (prior: $213.4 million to $245.4 million).

Business Segments and Product Lines:

• Signed eight license agreements across Pay-TV, consumer electronics, e-commerce, and social media during the quarter.
• Secured a multi-year license renewal with Charter, the largest Pay-TV and broadband provider in the U.S.
• Secured a multi-year license renewal with TCL, one of the world's largest manufacturers of connected TVs.
• Signed a new long-term license agreement with Fanatics, a leading sports apparel e-commerce company.
• Signed new license agreements with a social media company and a consumer electronics company.
• Signed three other license agreements with Pay-TV providers.
• Four new customers were added during the quarter.
• The Company's technology portfolio includes 3D interconnect (hybrid bonding), advanced thermal management for AI datacenters, content discovery, personalization, and streaming.

Market and Competitive Landscape:

• Management noted that AI is driving innovation in both media and semiconductors, with Adeia's foundational technologies positioned at the heart of these trends.
• The Company licenses its technologies to leaders across the chip design and manufacturing, consumer electronics, automotive, digital entertainment, and e-commerce industries.

Risks and Challenges:

• Risks include the ability to enter into new and renewal license agreements on favorable terms and the length of time required to finalize agreements.
• Potential risks involve the ability to retain and hire key personnel, uncertainty regarding the long-term value of common stock, and legislative, regulatory, and economic developments.
• Risks also include the Company's ability to grow patent portfolios, success in litigation and arbitration to defend IP rights, and changes in technology.
• Risks associated with indebtedness and the unpredictability of catastrophic events, including acts of terrorism, war, natural disasters, and global health pandemics, are noted.

Management Commentary and Tone:

• Dipti Vachani, newly appointed Chief Executive Officer, expressed honor in joining at an exciting time and confidence in the company's ability to grow and expand its business.
• Vachani highlighted strong deal activity with eight license agreements signed and noted the company is on target to achieve its long-term annual revenue outlook.
• CFO Keith Jones expressed pleasure with progress, noting a strong and growing pipeline, while acknowledging potential timing impacts on year-end revenue.
• Vachani thanked the Board and outgoing CEO Paul Davis for support during the transition, citing her 30 years of experience in the semiconductor space.

Other Key Points:

• Dipti Vachani was appointed as Chief Executive Officer.
• On September 14, 2026, the Company distributed a quarterly cash dividend of $0.05 per share ($5.5 million total) to stockholders of record on August 24, 2026.
• The Board declared a new quarterly cash dividend of $0.05 per share, payable on December 14, 2026, to stockholders of record on November 23, 2026.
• During the nine months ended September 30, 2026, the Company made $40.3 million in principal payments on debt agreements.
• During the nine months ended September 30, 2026, the Company repurchased $34.4 million of common stock and $20.0 million for tax withholdings on equity awards.
• During the nine months ended September 30, 2026, the Company paid $16.6 million in dividends.
• The Company's balance sheet shows total assets of $1.0 billion and total stockholders' equity of $482.8 million as of September 30, 2026.