rmarchma, would appreciate your opinion re IDCC's updated Q1 guidance(copied below). Best that I can do is compare the mid point of IDCC's updated revenue guidance range(i.e., "$35.3 to $35.7" = $35.5 million mid point), with the mid point of operating expense guidance given earlier(i.e., "up 13% to 17% over 4th qtr 2004" = +15% or ~$36.1 million mid point). That rough cut puts us within $600k of break even(i.e., $35.5 revenues minus $36.1 operating expenses), but I have no idea how to estimate the effect of other "earnings statement" things like "interest earned"(i.e., plus ~$500k?), or that $.8 million "deferred foreign tax" item(is that a minus $800k?).
Also wondering about the "journal entry" requested by the SEC audit team before giving IDCC their "seal of approval" back in March. Was it just a balance sheet adjustment, or did it create something reportable on the 1st qtr statement of earnings?
Here is all we got about that when IDCC disclosed the "all clear" results from the routine SEC audit on March 31, 2005; "In the balance sheet, foreign withholding tax related assets, previously classified as deferred charges, have been reclassified to deferred tax assets for all periods presented."
No matter how many times this old retired engineer reads that statement he cannot cause any sparks of meaningful enlightenment to occur.("Duh! No algebra equation there to solve.") LOL!
The reason I'm so interested in that adjustment is the dollar amount it involves, and my assumption that it actually represents "deferred revenues"??.
TIA for any help you(and/or anybody else) can provide. Here is the updated guidance for quick reference;
..........................................................................................................................
InterDigital Updates Guidance for First Quarter 2005; First Quarter Revenue
Related to General Dynamics Agreement Higher Than Previous Estimate
Friday April 29, 5:54 PM EDT
KING OF PRUSSIA, Pa., Apr 29, 2005 (BUSINESS WIRE) -- InterDigital
Communications Corporation (IDCC), a leading architect, designer and
provider of wireless technology and product platforms, today announced that
it is updating its guidance for first quarter 2005.
InterDigital now expects to report first quarter 2005 revenue in the range
of $35.3 million to $35.7 million. First quarter 2005 patent licensing
royalty revenue is expected to be approximately $30.8 million. In addition,
the Company anticipates that first quarter revenue associated with its
agreement with General Dynamics will be between $4.5 million and $4.9
million, an increase of $2.0 million to $2.4 million over the upper end of
previous revenue guidance for this contract. The Company also indicated that
deferred foreign source withholding tax expense for first quarter 2005 will
be approximately $0.8 million and reaffirmed the remaining elements of its
previous guidance included in its Form 10-K filing for the year ended
December 31, 2004.
Richard Fagan, InterDigital's Chief Financial Officer, stated, "We've made
excellent progress against an aggressive schedule in our work for General
Dynamics. As a result, we now expect to substantially exceed our previous
first quarter revenue guidance related to this agreement, which is being
accounted for on a percentage-of-completion basis."
InterDigital will release its first quarter 2005 financial results before
the market opens on Friday, May 6, 2005.
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