-- Net income1 was $52.5 million, or $1.46 per diluted share, compared to
$40.0 million, or $1.14 per diluted share, in second quarter 2016.
"The growth of our recurring revenue coupled with the careful management of our expenses, even including added costs related to Hillcrest Labs, underscores the strength of our business model," said William J. Merritt, President and CEO of InterDigital. "With a strong revenue platform anchored in long-term agreements with key licensees, InterDigital is ideally positioned to increase our market share and drive additional shareholder value."
Additional Financial Highlights for Second Quarter 2017
-- The increase in operating expenses included a $2.1 million increase in
costs associated with commercial initiatives, primarily Hillcrest Labs,
as well as a $1.7 million increase in consulting services, primarily
related to spending on development projects, as well as corporate
initiatives including the implementation of a new enterprise resource
planning system. These increases were partially offset by a $2.5 million
decrease in intellectual property enforcement and non-patent litigation.
-- The company's second quarter 2017 effective tax rate was a provision of
34.4% compared to a benefit of 74.4% during second quarter 2016. The
change in effective tax rate was primarily attributable to the discrete
impact of refund claims made during second quarter 2016.
-- In second quarter 2017, the company recorded $19.4 million of cash
provided by operating activities, compared to $191.4 million in second
quarter 2016. The company used $10.1 million of free cash flow2 in
second quarter 2017, compared to $182.4 million of free cash flow
generated in second quarter 2016. These changes were primarily due to
the timing of cash receipts under new fixed-fee agreements. Ending cash
and short-term investments totaled $885.4 million.
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