Adeia
A company that owns thousands of patents on TV guides, streaming and chip-stacking, and charges TV operators, streaming services and chipmakers a fee to use them.
Our viewUnattractive Medium conviction
The scores
The profile · 1-4
Growth2/4 ↓
Headline 2025 growth was the Disney settlement and recurring royalties fell 13.6% in Q2 2026. Not 1: revenue is not falling and semiconductor royalties doubled.
Business quality3/4 ↓
Patents exclude by law and the last three refusals ended in licences, but DIRECTV, DISH and Fubo refused within nine months, none resolved.
Financial position2/4 ↑
A $378M balloon falls due June 2028, inside the horizon, with refinancing deferred. Case for 3: BB-rated, $137M cash, $150M yearly cash flow.
Execution record3/4 →
Beat the 2025 guide and settled Disney and AMD fast, but Q1 recurring revenue was restated $7.7M unexplained and the chief executive is leaving.
Per share capture3/4 →
The diluted count drifts up 2% a year despite $52.9M spent on shares in six months; deals are cash and small, no convertible.
Potential2/4 →
The $200M semiconductor target and the Pay-TV recoveries need a chipmaker, a court or a creditor to move; only $519M of fixed fees is committed.
Risk profile2/4 ↓
Two of the five customers that were 55.7% of revenue are litigants, one behind a bankruptcy stay, and any asserted patent can be reviewed.
Valuation2/4 ↑
Twice the prior price per dollar of profit on shrunken recurring royalties, needing the $90M exit rate or a settlement. Not 1: cash yields 5-7%.
Evidence quality3/4 →
Filed figures for revenue, disputes and debt, plus the counterparties' own filings; the Pay-TV split, semiconductor mix and rates are management's or undisclosed.
The bet · 2-3 years
Priced for success0.6×
If it works 0.6× · if it fails you keep about 32%.
The Verdict
We rate Adeia unattractive. It makes nothing: it licenses patents on how people find and stream video and on stacking chips, and the fees are hard to avoid, but the royalties that recur each year fell after two big TV operators stopped paying, so the business is mixed. Last year's record sales leaned on one settlement, and the shares rose anyway. The price is full: it assumes both operators sign again and the chip business arrives, so a miss on either would hurt. As a bet on its chip and online-shopping patents it is priced for success: even if both grow, the shares end up worth about half of today.
The long caseChipmakers are moving to hybrid bonding to stack AI chips, and if they need Adeia's patents to do it, chip royalties could grow several times.
The evidence under this - 9 claims
C01facthigh confidence
Adeia is a patent licensor with about 150 employees and one reportable segment; it held about 13,750 patent assets at 31 December 2025 and licenses a media portfolio to Pay-TV operators, streaming services, consumer-electronics makers and social networks, and a semiconductor portfolio to Kioxia, Micron, Samsung, Sandisk, SK hynix, Sony, STMicroelectronics and UMC.
C02facthigh confidence
2025 revenue was $443.4M: recurring revenue $351.3M, up 2.9% from $341.5M, and non-recurring revenue $92.0M, up from $34.6M. Revenue from performance obligations satisfied in previous periods - past-infringement releases, settlements and back-royalties - was $91.1M in 2025 against $31.0M in 2024.
C03facthigh confidence
The 2025 increase was primarily attributable to a new long-term licence with Disney executed in Q4 2025, a portion of which was recognised up front; Q4 2025 revenue was $182.6M against $87.3M in Q3 2025, and the Disney litigation begun in November 2024 was dismissed on settlement in December 2025.
C04facthigh confidence
Q2 2026 revenue was $96.1M, up 12.1%; recurring revenue fell 13.6% to $73.5M from $85.1M; non-recurring revenue was $22.6M against $0.6M. For the six months recurring revenue was $147.4M against $169.5M, down 13.0%.
C32facthigh confidence
The shares closed at $24.82 on 18 September 2026, up 58.1% over 252 sessions from $15.70; trailing revenue for each diluted share rose 21.9% and the price paid for each dollar of it rose 29.6%. The 52-week range is $11.61 to $34.34, the close 27.7% below the high. Trailing price to earnings is 22.0 against a six-year prior median of 10.0, EV to EBITDA 11.7 against 6.9, price to sales 5.8 against 2.8; market value $2.74B, enterprise value $3.06B.
C33estimatemedium confidence
At $3.06B of enterprise value the market pays about $10.40 for each dollar of the Q2 2026 recurring royalty run-rate of $294.1M, and about 20 times the roughly $150M of operating cash flow management guides for 2026; on reported trailing revenue, which carries the Disney settlement, the same price reads as 6.5 times.
derivedEnterprise value $3,059,978,080 from the pack (market value $2,737,497,080 plus debt less cash); Q2 2026 recurring revenue $73,524K times four; the $150M operating-cash-flow guide from the Q2 call; 3,060 over 294.1 is 10.4 and over 150 is 20.4.
against this
- Annualising one quarter understates a business whose Q1 recurring figure was later restated up by $7.7M and whose exit rate is guided to $90M; on $360M of recurring the multiple is 8.5.
- Trailing free cash flow is about $189M, a 6.9% yield on the market value, which is not an extreme price - but 2025's cash flow fell while revenue rose and the 2026 guide is $150M.
C41inferencemedium confidence
The year's re-rating was paid on settlements: the price rose 58.1% while recurring revenue fell, and the trailing revenue the multiple is struck on carries $91.1M of Disney back-royalties that will not repeat.
derivedC32 gives the price and multiple change; C02 and C03 give the 2025 one-offs; C04 gives the recurring decline in the newest quarter.
against this
- The market may be paying for the semiconductor target rather than for trailing revenue; the shares rose 12.3% on the day that target was raised and the recurring decline was disclosed.
- Non-Pay-TV recurring revenue grew 54% by management's account, so part of the multiple may price a mix shift the filings do not split out.
C42inferencemedium confidence
DIRECTV and DISH leaving the licensed base account for most of the fall in recurring revenue from $94.5M in Q4 2025 to $73.5M in Q2 2026: the Pay-TV customers whose royalties declined are the ones the 10-Q names as the cause, and management accepted an analyst's framing that the two had 'come out of the numbers'.
derivedC05 attributes the decline to Pay-TV royalties; C06 and C07 date the two lapses to December 2025 and March 2026; C10 shows two 10%-plus customers of Q2 2025 absent in Q2 2026; the Q4 2025 recurring figure is the chief financial officer's on the Q1 call.
against this
- The chief financial officer also attributed part of the Q1 fall to 'the timing of renewals with certain pay-TV customers' and to Kioxia and Sandisk contributing nothing in Q1, so some of the decline is timing rather than loss.
- Comcast's video base fell 9.4% in a year, so part of the Pay-TV decline is subscriber loss at licensed operators.
C15management claimlow confidence
Management raised its long-term annual revenue target to $600M from $500M in August 2026, with semiconductors at $200M (from $100M) and media at $400M, and places 'long term' at about five years.
sourceAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- 2025 semiconductor revenue was $25.7M and Q2 2026's $14.8M annualises to $59M; the target is more than three times the run-rate and rests on adoption and relicensing dated 2027 and 2028 by management itself.
- The $500M target that preceded it was set before the DIRECTV and DISH lapses and was not lowered when they happened; the media half stays at $400M against 2025 media revenue of $417.6M that included Disney's one-off.
The company
Every TV guide, recording box and streaming app uses ideas somebody patented. Adeia owns about 13,750 such patents, most on how viewers find, record and stream video, and a smaller group on stacking one chip on another. It sells nothing physical and has about 150 staff.
The buyers are cable and satellite operators, streaming services such as Disney+ and Peacock, TV makers and chipmakers. Their alternative to a licence is a lawsuit.
The evidence under this - 4 claims
C01facthigh confidence
Adeia is a patent licensor with about 150 employees and one reportable segment; it held about 13,750 patent assets at 31 December 2025 and licenses a media portfolio to Pay-TV operators, streaming services, consumer-electronics makers and social networks, and a semiconductor portfolio to Kioxia, Micron, Samsung, Sandisk, SK hynix, Sony, STMicroelectronics and UMC.
C48facthigh confidence
Headcount was about 150 at the end of both 2024 and 2025; revenue for each employee was $2.96M in 2025 against $3.66M in 2022, down 19%, and about 80% of the combined portfolio is internally generated.
C46facthigh confidence
The FY2025 10-K names Charter, Comcast (including Sky), Cox, DISH Network (including Sling TV), Google (including YouTube TV), Hulu + Live TV, Optimum, Verizon and Vodafone as licensed Pay-TV operators, and Amazon, DAZN, Disney+, ESPN+, Google, Hulu, Starz and Peacock as licensed streaming customers.
C22facthigh confidence
Three refusals have ended in licences: Disney litigated from November 2024 and signed a long-term licence in December 2025 with all cases and patent-board petitions withdrawn; AMD was sued in November 2025 and signed a multi-year licence in March 2026, within four months; Altice USA (Optimum) renewed after a dispute.
How it makes money
Cable and satellite operators usually pay a monthly fee for each subscriber. Streaming services pay a fixed fee for a set number of years; chipmakers pay fixed fees or a royalty per chip. Separately, a customer that settles a dispute pays for past use in a lump, which swells one quarter and never repeats.
The evidence under this - 2 claims
C25facthigh confidence
Pay-TV operators 'typically pay us a monthly per-subscriber fee'; streaming and social-media companies pay fixed fees for specified periods; consumer-electronics makers pay per unit or fixed fees; semiconductor customers pay fixed fees, per-unit, production-based or milestone fees, and some semiconductor licences convert to fully paid-up at the end of their term.
C02facthigh confidence
2025 revenue was $443.4M: recurring revenue $351.3M, up 2.9% from $341.5M, and non-recurring revenue $92.0M, up from $34.6M. Revenue from performance obligations satisfied in previous periods - past-infringement releases, settlements and back-royalties - was $91.1M in 2025 against $31.0M in 2024.
Where the money comes from, stream by stream
| Stream | Share of sales (H1 2026) | How it earns it |
|---|---|---|
| Semiconductor | 24.1% | Chipmakers pay fixed fees, per-unit or production-based royalties, often booked up front on signing; AMD's back payment inflated the half. |
| Media: Pay-TV operators | not disclosed; management expects 35% to 40% of 2026 | Cable and satellite operators pay a monthly fee per subscriber for the media patents, so it shrinks as subscribers leave. |
| Media: streaming services | not disclosed; management expects 30% to 35% of 2026 | Streaming and social-media companies pay fixed fees for multi-year licences, recognised evenly over the term. |
| Media: devices, social, e-commerce and other | not disclosed; Media in total 75.9% | Device makers pay per unit or fixed fees; e-commerce sites license through pooled agreements such as RPX's. |
Who runs it
Paul Davis has run Adeia since it became a separate company in 2022 and leaves on 12 October; Dipti Vachani, a chip-licensing veteran from Arm, takes over with no record here yet. Insiders own about 2%, and the largest holder among them is the man leaving.
The bonus rides mostly on total sales, which counts one-time settlements as fully as steady royalties; the shares pay on profit before legal costs. Nothing rewards the recurring royalties the case turns on.
The evidence under this - 3 claims
C37facthigh confidence
Chief executive Paul Davis announced on 4 May 2026 that he would step down for health reasons; on 24 September 2026 the board appointed Dipti Vachani, a former Arm automotive general manager with nearly 30 years in semiconductor IP, as his successor from 12 October 2026, and Davis stays as a consultant to 31 December 2026 for a fixed $183,000; on 22 July 2026 the board amended the severance agreements of the chief financial, revenue and legal officers.
sourceAdeia Form 8-K, Item 5.02: Dipti Vachani appointed chief…primaryAdeia Q1 2026 earnings call transcriptprimaryAdeia Form 8-K, amended severance agreements for the chief…primary
- 2026-09-29editedThe successor search closed: 8-K of 28 September 2026 names Dipti Vachani chief executive from 12 October; the claim said the search was ongoing.
C56facthigh confidence
At 9 March 2026 the eleven current directors and named executive officers owned 2,179,783 shares, 2.0% of the company; the chief executive Paul Davis held 1.0%, the largest insider stake, and the chief financial officer 0.3%. BlackRock (14.9%), Ameriprise (13.3%) and Vanguard (12.6%) were the holders above 5%. There is one class of common stock.
against this
The largest insider stake belongs to a chief executive who is leaving (C37), and the chief legal officer sold 99,342 shares in May 2026, about half the 202,333 the table gave him (C36); the incoming chief executive's holding is not disclosed.
C57facthigh confidence
The 2025 bonus paid on total revenue against the guidance midpoint (50%), non-GAAP operating expenses excluding litigation (30%) and strategic goals (20%); revenue of $443.4M scored 168.4% and the corporate factor 181.2%. PSUs, 60% of the chief executive's equity, pay on yearly EBITDA excluding litigation with a three-year relative shareholder-return modifier; the rest are four-year RSUs.
against this
- The revenue goal counts one-time back-royalties as fully as recurring royalties, and 2025 carried $91.1M of them (C02); litigation, the cost of winning those settlements, is excluded from both the expense goal and the PSU EBITDA.
- The expense goal scored 200% only after the committee excluded the cost of the bonus overachievement itself; without that exclusion it scored 108%.
Why it wins, and who could beat it
Why customers come back
A patent is a legal right to exclude. A licensee that stops paying keeps using the ideas and becomes a defendant; EchoStar's own filing warns of damages that could be trebled. The last three disputes ran refusal, lawsuit, licence: Disney signed after a year, AMD within four months, and Altice renewed.
But the wall leaks. DIRECTV has dropped off the licensed list, recurring revenue fell 13.6% in the June quarter, and at the patent office 17% of challenges ended with every claim struck out.
The evidence under this - 6 claims
C20facthigh confidence
The 10-K states that 'due to the exclusionary nature of patent rights, we do not compete, in a traditional sense, with other patent holders'; that US patents expire at various times through the next two decades and the last issued patent in March 2045; and that inter partes reviews 'have a high rate of invalidation of patents, and patents we have asserted in litigation have been and may continue to be invalidated'.
C08facthigh confidence
EchoStar reported 6.391 million US Pay-TV subscribers at 30 June 2026, 4.684 million DISH TV and 1.707 million Sling TV, describes Adeia as 'an entity that seeks to license a patent portfolio without itself practicing any of the claims', and says an adverse outcome could bring substantial damages, possibly trebled, and an injunction requiring it to modify features.
C22facthigh confidence
Three refusals have ended in licences: Disney litigated from November 2024 and signed a long-term licence in December 2025 with all cases and patent-board petitions withdrawn; AMD was sued in November 2025 and signed a multi-year licence in March 2026, within four months; Altice USA (Optimum) renewed after a dispute.
C09facthigh confidence
The FY2024 10-K listed 'AT&T (including DirecTV and DirecTV Stream)' among licensed Pay-TV operators; the FY2025 10-K's list omits DIRECTV. Five customers were 49.6% of 2024 revenue and 55.7% of 2025 revenue.
C04facthigh confidence
Q2 2026 revenue was $96.1M, up 12.1%; recurring revenue fell 13.6% to $73.5M from $85.1M; non-recurring revenue was $22.6M against $0.6M. For the six months recurring revenue was $147.4M against $169.5M, down 13.0%.
C21facthigh confidence
In the patent office's fiscal 2025 the board's institution rate by petition was 50% (620 of 935 decided petitions granted, before director discretionary denials), and of 1,470 petition outcomes 250 (17%) were final written decisions holding all claims unpatentable, 75 (5%) mixed, 62 (4%) all claims patentable and 368 (25%) settled.
The threat
The threat is customers who stop paying and fight. DIRECTV sued first, asking a court to declare seven patents not infringed and three invalid, and defeated Adeia's request for an injunction. DISH let a decades-old licence expire, and its bankruptcy filing has frozen Adeia's case. Fubo declined a licence too. In chips, TSMC sells its own stacking service and mentions no licence.
The evidence under this - 4 claims
C06facthigh confidence
DIRECTV filed a declaratory-judgment action against Adeia on 29 December 2025 seeking non-infringement of seven media patents and invalidity of three; Adeia sued DIRECTV for breach of contract and trade-secret misappropriation on 12 January 2026, its preliminary-injunction motion was denied on 2 July 2026, and it sued DIRECTV on four patents on 2 July 2026. No trial date is set in any of them.
C07facthigh confidence
DISH's licence expired at the end of March 2026 after decades as a customer; Adeia sued DISH Network, DISH DBS, EchoStar and Sling TV on five patents on 1 April 2026, DISH and Sling filed for a declaration of non-infringement or invalidity of ten patents the same day, and certain DISH parties filed for Chapter 11 on 30 June 2026, automatically staying Adeia's case.
C38facthigh confidence
Adeia sued FuboTV in Delaware on 1 July 2026 on four media patents after failing to agree a licence; Fubo's 10-Q records the suit, a stipulated extension of its response to 21 September 2026, and states it cannot estimate a loss. Disney is Fubo's controlling shareholder and Adeia says the Disney licence is separate.
C18facthigh confidence
Intel's FY2025 10-K says it 'continued development of Foveros Direct, announced in 2025, with hybrid-bonding support planned on our Intel 18A-PT process in 2028'; TSMC's FY2025 20-F offers 'TSMC-SoIC manufacturing services' as its own chip-stacking service and mentions no licence.
The rivals: ECHO, FUBO, TSM, INTC, IDCC, and 2 more that are private, in-house or listed abroad.
Who else does this, rival by rival
| Ticker | Rival | Where it competes | How far along | Priced against it |
|---|---|---|---|---|
| Private | DIRECTV, LLCPriced against it: Private | Media patent licensing | On sale | Private |
| ECHO | EchoStar's DISH Network and Sling TVPriced against it: Different product | Media patent licensing | On sale | Different product |
| FUBO | FuboTV Inc.Priced against it: Different product | Media patent licensing | On sale | Different product |
| TSM · INTC | TSMC's own TSMC-SoIC stacking service and Intel's Foveros DirectPriced against it: Different product | Semiconductor and e-commerce patent licensing | On sale | Different product |
| In-house | Online retailers challenging the patents at the patent board or designing around themPriced against it: In-house | Semiconductor and e-commerce patent licensing | On sale | In-house |
| IDCC | InterDigitalPriced against it: Same product | - | On sale | Same product |
How big it could get
How big this could get
America's traditional pay-TV base was 54.1 million subscribers at the end of 2023, down 12.6% in a year, and it is still shrinking: Comcast lost 9.4% of its video customers in the year to June 2026. The growth is in chips, where orders at Besi, which makes the stacking machines, rose 128.8% in the June quarter. Nobody discloses the fee per subscriber or per chip, so the market cannot be priced.
The evidence under this - 4 claims
C54facthigh confidence
The FCC's 2024 Communications Marketplace Report puts the whole US traditional MVPD base at 54.1 million subscribers at the end of 2023, down from 61.9 million a year earlier - a loss of 7.8 million, or 12.6% in one year - split 65.3% cable, 25.3% direct-broadcast satellite and 9.4% telephone company, with the largest operators serving about 92% of it. The FCC compiles the figures from S&P Global rather than collecting them itself.
C24facthigh confidence
Comcast reported 10.668 million domestic video customers at 30 June 2026 against 11.771 million a year earlier, down 9.4%, and says video revenue fell 'primarily due to declines in the overall number of video customers'; Charter reported 12.524 million total video customers against 12.631 million, down 0.8%.
C17facthigh confidence
BE Semiconductor Industries booked orders of €292.9M in Q2 2026, up 128.8% on Q2 2025, and attributes revenue growth of 68.7% 'primarily to broad based growth, particularly for hybrid bonding, photonics and datacenter applications'.
C25facthigh confidence
Pay-TV operators 'typically pay us a monthly per-subscriber fee'; streaming and social-media companies pay fixed fees for specified periods; consumer-electronics makers pay per unit or fixed fees; semiconductor customers pay fixed fees, per-unit, production-based or milestone fees, and some semiconductor licences convert to fully paid-up at the end of their term.
Who has signed
Disney, Google, AMD and ten e-commerce companies through one agreement have signed multi-year licences since late 2025. Fixed-fee contracts longer than a year hold $519.1M of future revenue, $137.1M of it due in 2027. DIRECTV and DISH are the gap.
The evidence under this - 5 claims
C22facthigh confidence
Three refusals have ended in licences: Disney litigated from November 2024 and signed a long-term licence in December 2025 with all cases and patent-board petitions withdrawn; AMD was sued in November 2025 and signed a multi-year licence in March 2026, within four months; Altice USA (Optimum) renewed after a dispute.
C23management claimmedium confidence
Management says the renewal rate is over 90%; Google, a customer since 2012, renewed a multi-year licence to the media portfolio in May 2026, and Vodafone renewed in Q4 2025.
sourceAdeia Q2 2026 earnings call transcriptprimaryAdeia press release - Adeia and Google Renew Multi-Year IP…primaryAdeia Q4 and full-year 2025 results release, Form 8-K…primary
against this
- The rate is by count, and the three refusals in nine months - DIRECTV, DISH, Fubo - include two of the five largest customers, so a 90% count can coincide with a 13.6% fall in recurring revenue.
- The Google release gives no term and no fee; renewals at lower fees would satisfy the rate and shrink the revenue.
C14facthigh confidence
Semiconductor revenue was $25.7M in 2025, $18.6M in 2024 and $45.4M in 2023; it was $48.3M in the six months to June 2026, of which $14.8M in Q2, so $33.5M in Q1 2026. The AMD agreement signed in March 2026 included a retroactive amount recognised in Q1; management said AMD will not be a 10% customer going forward.
C47management claimlow confidence
The RPX agreement of 30 June 2026 licenses ten e-commerce member companies under one multi-year contract; management says e-commerce, begun about two years earlier with a first licence at the end of 2024, now has 15 customers across six agreements and could grow to about 10% of revenue, the size of the consumer-electronics business.
sourceAdeia press release - Adeia Enters into Multi-Year IP…primaryAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- No fee, term or per-member figure is disclosed; RPX describes its syndicated deals as reducing cost for members, which is a buyer negotiating a discount.
- Management would not describe the negotiation and said only that the structure 'can potentially' be replicated.
C29facthigh confidence
Remaining revenue under fixed-fee contracts longer than a year was $519.1M at 30 June 2026: $74.9M in the rest of 2026, $137.1M in 2027, $127.2M in 2028, $90.0M in 2029, $37.3M in 2030 and $52.7M after.
Where the growth is coming from, business by business
Where the growth is coming from
| Business | Share of revenue | Growth: last quarter | Last half-year | Last year |
|---|---|---|---|---|
| Media Platform | 85% | +0.3% | -7.5% | -5.3% |
| Semiconductor | 15% | +215.3% | +476.8% | +278.3% |
| Whole company | 100% | +12.1% | +15.8% | +7.8% |
The filed split through 2026-06-30. These rates are not carried forward: the reading below says why.
How we read it: The score believes neither high reading: the trailing 24% carries Disney's Q4 catch-up and Semiconductor's half-year rate is AMD's retroactive Q1 payment on a small base; recurring royalties fell 13%.
The results
The numbers
Is it growing?Steady
Sales grew 24% over the twelve months to Jun 2026, faster than the 18% in the year to Dec 2025.
Is it profitable?Strong
Operating margin is 42%, up from 35% in the year to Dec 2023.
How steady is it?Swingy
Yearly sales growth has ranged from −24% to +18% over the last 5 years, with sales falling in 3 of them.
Does it earn good returns?Decent
Each dollar put into the business earns 17% a year after tax, up from 5.0% in the year to Dec 2021.
Is it making cash?Strong
It turned 40% of sales into free cash, $189M over the last twelve months.
Is the balance sheet safe?Light debt
It owes $249M more than the cash it holds, about 1.3 years of the cash its operations bring in.
Are shares being diluted?Creeping
The share count rose 6.6% in 4.5 years, and pay in shares costs 7.8% of sales.
All the numbers
Filed figures from the company's 10-K and 10-Q, read 2026-10-04. Fiscal years end in December.
| Dec 2021 | Dec 2022 | Dec 2023 | Dec 2024 | Dec 2025 | 12 mo to Jun 2026 | |
|---|---|---|---|---|---|---|
| Size and growth | ||||||
| Sales | $391M | $439M | $389M | $376M | $443M | $471M |
| Sales growth | −24% | +12% | −11% | −3.3% | +18% | +24% |
| Profit | ||||||
| Operating margin | 30% | 35% | 35% | 34% | 39% | 42% |
| Net margin | −14% | −67% | 17% | 17% | 25% | 26% |
| What growth costs, per sales dollar | ||||||
| Research and development | 10% | 10% | 14% | 16% | 15% | 15% |
| Selling, general and admin | 33% | 31% | 24% | 28% | 27% | 25% |
| Pay in shares | 6.6% | 5.2% | 4.6% | 7.1% | 7.8% | 7.8% |
| Capital spending | 3.6% | 2.9% | 1.0% | 0.5% | 0.4% | 0.5% |
| Cash | ||||||
| Cash from operations | $235M | $183M | $153M | $212M | $158M | $191M |
| Free cash flow | $221M | $170M | $149M | $211M | $156M | $189M |
| Balance sheet | ||||||
| Cash and short-term investments | $141M | $115M | $83.6M | $110M | $137M | $137M |
| Debt | $765M | $729M | $586M | $475M | $418M | $386M |
| Net cash | −$625M | −$615M | −$502M | −$365M | −$282M | −$249M |
| Returns and shares | ||||||
| Return on capital | 5.0% | 9.7% | 12% | 11% | 16% | 17% |
| Shares (diluted) | 107M | 108M | 113M | 113M | 113M | 114M |
What growth costs
Sales have gone sideways for four years, so there is no growth to judge yet. Most costs are people and patents that do not rise with a new licence, but winning one usually means a lawsuit first, and legal bills are climbing.
The evidence under this - 2 claims
C59facthigh confidence
Revenue was $438.9M in 2022 and $443.4M in 2025. Per sales dollar over those years R&D rose from 10.2 to 15.2 cents, selling, general and administrative fell from 30.9 to 27.0, and stock pay rose from 5.2 to 7.8; amortisation of acquired patents fell from 19% of revenue in 2024 to 13% in 2025 and litigation rose from 4% to 5%.
sourceAdeia Inc. Form 10-K for the year ended 31 December 2025primaryAdeia Inc. Form 10-K for the year ended 31 December 2024primary
against this
The 2025 margin gain from 34.2% to 39.5% came mostly from amortisation rolling off and the Disney catch-up (C03), not from any cost growing slower than recurring sales.
C40facthigh confidence
Litigation expense was $24.7M in 2025, up 81%, $11.3M in the six months to June 2026, and management expects it to remain a significant portion of operating expenses and to rise year on year in 2026.
The last report (3 Aug)
Quarter ended June 2026, filed figures.
12%
Sales growth
against the same quarter a year earlier
-8.3%
Growth from the quarter before
against -42.6% the quarter before that
26¢
Operating profit
per dollar of sales
Headline revenue in the second quarter of 2026 rose 12.1% to $96.1M, and the company raised its long-term target from $500M to $600M a year. The shares rose 12.3% the next day.
Underneath, recurring royalties fell 13.6% to $73.5M as pay-TV customers stopped paying, and lump-sum payments for past use made up the difference. Management says everything outside pay-TV grew 54%, and promises recurring revenue of about $90M a quarter by the end of 2026.
What it did to the thesisIt confirmed why the view is Unattractive: the headline growth came from one-time back-payments while the recurring royalties the price depends on shrank. The higher long-term target is a promise rather than signed business, and the recovery management describes still has to show up.
The quarter in detail
Sales growth from the previous quarter, filed figures.
Earnings per share $0.34 against $0.31 expected; $0.15 as filed, the gap being what the company adds back.
The evidence under this - 6 claims
C04facthigh confidence
Q2 2026 revenue was $96.1M, up 12.1%; recurring revenue fell 13.6% to $73.5M from $85.1M; non-recurring revenue was $22.6M against $0.6M. For the six months recurring revenue was $147.4M against $169.5M, down 13.0%.
C15management claimlow confidence
Management raised its long-term annual revenue target to $600M from $500M in August 2026, with semiconductors at $200M (from $100M) and media at $400M, and places 'long term' at about five years.
sourceAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- 2025 semiconductor revenue was $25.7M and Q2 2026's $14.8M annualises to $59M; the target is more than three times the run-rate and rests on adoption and relicensing dated 2027 and 2028 by management itself.
- The $500M target that preceded it was set before the DIRECTV and DISH lapses and was not lowered when they happened; the media half stays at $400M against 2025 media revenue of $417.6M that included Disney's one-off.
C52facthigh confidence
The Q3 2025 print on 3 November 2025 reported revenue of $87.3M against the vendor panel's $168.4M and adjusted earnings of $0.28 a share against $0.36; the Q4 2025 print reported $182.6M against $168.4M and $0.86 against $0.65; the Q2 2026 print reported $96.1M against $96.8M and $0.34 against $0.31, and the shares rose 12.3% the next session.
C05facthigh confidence
The 10-Q attributes the recurring decline primarily to declines in royalty revenue from certain Pay-TV customers, partially offset by licence agreements with new customers signed after Q2 2025, and the non-recurring rise to two multi-year agreements in Q2 2026 that each included consideration for the release of past infringement.
C11management claimmedium confidence
Management says non-Pay-TV recurring revenue grew 54% year on year in Q2 2026 and is now nearly double Pay-TV recurring revenue; it grew 28% in Q1 2026, 30% in Q4 2025 and 22% for 2025; Pay-TV is expected at 35% to 40% of 2026 revenue against a historical 50% to 60%.
sourceAdeia Q2 2026 earnings call transcriptprimaryAdeia Q1 2026 earnings call transcriptprimaryAdeia Q4 2025 earnings call transcriptprimary
against this
- No filing carries a Pay-TV against non-Pay-TV split; the 10-Q disaggregates only media against semiconductor and recurring against non-recurring, so the 54% cannot be checked.
- Total recurring revenue fell 13.6% in the same quarter, so whatever the non-Pay-TV growth was, Pay-TV royalties fell by more than it added.
C12management claimmedium confidence
The chief financial officer guided quarterly recurring revenue to grow through 2026 to approximately $90M by the end of the year, full-year operating cash flow of about $150M, and year-end cash of about $100M; 2026 revenue guidance of $395M to $435M was reiterated in February, April, May and August 2026.
sourceAdeia Q1 2026 earnings call transcriptprimaryAdeia Q2 2026 earnings call transcriptprimaryAdeia Form 8-K, press release on the DISH Network litigation…primaryAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primary
against this
- Recurring revenue was $73.5M in Q2 2026, so the exit rate needs a 22% rise in two quarters with DIRECTV and DISH still unlicensed (C50).
- On the Q2 call the chief financial officer said the internal forecast 'looks a lot like the consensus models', which sit near $416M, below the guide's midpoint; the chief executive said the year 'can come from various different avenues' including 'the Pay-TV items that we've got in dispute'.
What management did with the money
In the first half it repaid $34.2M of debt, paid $11.0M of dividends and bought back $20.0M of shares, yet the diluted share count rose 2.0% on staff awards. The chief executive is stepping down for health reasons, with a successor expected by the fourth quarter.
Insiders in 2026Q2: 6 purchases and 2 sales, from their Form 4 filings.
The evidence under this - 2 claims
C27facthigh confidence
In the six months to June 2026 operating cash flow was $113.1M; the company paid $34.2M of debt principal, $11.0M of dividends, $20.0M of buybacks (0.8 million shares at $25.06), $32.9M of share repurchases for tax withholding on equity awards and $15.0M for patent portfolios; stock compensation expense was $19.2M. Diluted weighted shares were 114.4 million in Q2 2026 against 112.2 million a year earlier, up 2.0%.
C37facthigh confidence
Chief executive Paul Davis announced on 4 May 2026 that he would step down for health reasons; on 24 September 2026 the board appointed Dipti Vachani, a former Arm automotive general manager with nearly 30 years in semiconductor IP, as his successor from 12 October 2026, and Davis stays as a consultant to 31 December 2026 for a fixed $183,000; on 22 July 2026 the board amended the severance agreements of the chief financial, revenue and legal officers.
sourceAdeia Form 8-K, Item 5.02: Dipti Vachani appointed chief…primaryAdeia Q1 2026 earnings call transcriptprimaryAdeia Form 8-K, amended severance agreements for the chief…primary
- 2026-09-29editedThe successor search closed: 8-K of 28 September 2026 names Dipti Vachani chief executive from 12 October; the claim said the search was ongoing.
The price, and where we disagree
In short. Full. The price already pays for DIRECTV and DISH signing again and for the chip business arriving. Neither has happened yet, and last year's sales were swollen by one-time back-payments.
Share price
$24.82
close,
Company value for each $1 of sales
6.5
its 6-year normal 4.2
The shares are 27.7% below their 52-week high, after a year in which they rose on settlements rather than royalties.
The next test is the third-quarter results, due 2 November. Recurring revenue has to climb from $73.5M toward the promised $90M without DIRECTV or DISH, a 22% rise in two quarters, and any rise needs checking for a settlement counted as recurring.
The evidence under this - 4 claims
C32facthigh confidence
The shares closed at $24.82 on 18 September 2026, up 58.1% over 252 sessions from $15.70; trailing revenue for each diluted share rose 21.9% and the price paid for each dollar of it rose 29.6%. The 52-week range is $11.61 to $34.34, the close 27.7% below the high. Trailing price to earnings is 22.0 against a six-year prior median of 10.0, EV to EBITDA 11.7 against 6.9, price to sales 5.8 against 2.8; market value $2.74B, enterprise value $3.06B.
C41inferencemedium confidence
The year's re-rating was paid on settlements: the price rose 58.1% while recurring revenue fell, and the trailing revenue the multiple is struck on carries $91.1M of Disney back-royalties that will not repeat.
derivedC32 gives the price and multiple change; C02 and C03 give the 2025 one-offs; C04 gives the recurring decline in the newest quarter.
against this
- The market may be paying for the semiconductor target rather than for trailing revenue; the shares rose 12.3% on the day that target was raised and the recurring decline was disclosed.
- Non-Pay-TV recurring revenue grew 54% by management's account, so part of the multiple may price a mix shift the filings do not split out.
C50estimatehigh confidence
Reaching the guided $90M of quarterly recurring revenue by Q4 2026 requires a 22% rise from Q2 2026's $73.5M within two quarters, with DIRECTV and DISH unlicensed.
derivedC12 gives the $90M guide; C04 gives the $73.5M; 90 over 73.5 is 1.224.
against this
- The Q1 figure was restated from $66.3M to $73.9M in the next 10-Q, so the quarterly recurring line moves with classification as well as with customers, and a further reclassification could close part of the gap.
- Kioxia and Sandisk contributed nothing in Q1 by management's account and were expected to contribute 'meaningful revenue in the following quarters', which is recurring per-unit royalty.
C12management claimmedium confidence
The chief financial officer guided quarterly recurring revenue to grow through 2026 to approximately $90M by the end of the year, full-year operating cash flow of about $150M, and year-end cash of about $100M; 2026 revenue guidance of $395M to $435M was reiterated in February, April, May and August 2026.
sourceAdeia Q1 2026 earnings call transcriptprimaryAdeia Q2 2026 earnings call transcriptprimaryAdeia Form 8-K, press release on the DISH Network litigation…primaryAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primary
against this
- Recurring revenue was $73.5M in Q2 2026, so the exit rate needs a 22% rise in two quarters with DIRECTV and DISH still unlicensed (C50).
- On the Q2 call the chief financial officer said the internal forecast 'looks a lot like the consensus models', which sit near $416M, below the guide's midpoint; the chief executive said the year 'can come from various different avenues' including 'the Pay-TV items that we've got in dispute'.
The betPriced for success
If it works
0.6×
from today's value, at the stated multiple
If it fails
keep 32%
of today's market value: the rest of the company, less its debt
How we read the multiple
Buyers pay about 6.5 times last year's sales for the whole company, debt included. That flatters it: those sales include $91.1M of back-payments from Disney that will not repeat. The share price rose 58% over the year while the royalties that do repeat fell.
Measured on what repeats, the $3.06B price is:
- About $10.40 for each $1 of yearly recurring royalties, at the June quarter's pace.
- About 20 times the cash management expects operations to bring in this year.
Against its own history. Far dearer than its own normal, and the gap was paid on one-time settlements rather than on royalties that recur.
The evidence under this - 3 claims
C33estimatemedium confidence
At $3.06B of enterprise value the market pays about $10.40 for each dollar of the Q2 2026 recurring royalty run-rate of $294.1M, and about 20 times the roughly $150M of operating cash flow management guides for 2026; on reported trailing revenue, which carries the Disney settlement, the same price reads as 6.5 times.
derivedEnterprise value $3,059,978,080 from the pack (market value $2,737,497,080 plus debt less cash); Q2 2026 recurring revenue $73,524K times four; the $150M operating-cash-flow guide from the Q2 call; 3,060 over 294.1 is 10.4 and over 150 is 20.4.
against this
- Annualising one quarter understates a business whose Q1 recurring figure was later restated up by $7.7M and whose exit rate is guided to $90M; on $360M of recurring the multiple is 8.5.
- Trailing free cash flow is about $189M, a 6.9% yield on the market value, which is not an extreme price - but 2025's cash flow fell while revenue rose and the 2026 guide is $150M.
C41inferencemedium confidence
The year's re-rating was paid on settlements: the price rose 58.1% while recurring revenue fell, and the trailing revenue the multiple is struck on carries $91.1M of Disney back-royalties that will not repeat.
derivedC32 gives the price and multiple change; C02 and C03 give the 2025 one-offs; C04 gives the recurring decline in the newest quarter.
against this
- The market may be paying for the semiconductor target rather than for trailing revenue; the shares rose 12.3% on the day that target was raised and the recurring decline was disclosed.
- Non-Pay-TV recurring revenue grew 54% by management's account, so part of the multiple may price a mix shift the filings do not split out.
C02facthigh confidence
2025 revenue was $443.4M: recurring revenue $351.3M, up 2.9% from $341.5M, and non-recurring revenue $92.0M, up from $34.6M. Revenue from performance obligations satisfied in previous periods - past-infringement releases, settlements and back-royalties - was $91.1M in 2025 against $31.0M in 2024.
Priced against its rivals
Only InterDigital sells the same thing to the same buyers as a large part of what it does. A price comparison needs at least two, so the price is judged against its own history instead.
Also checked and set aside: Rambus (a substitute, not the same product); Xperi (a substitute, not the same product).
The bet: what it pays if it works
The bet is on two young parts of Adeia: its patents on stacking chips face to face, and on how online shops search and show products. Chip royalties jump with one-off payments, and online shops have signed for undisclosed sums. So the video business is counted separately, at Adeia's usual price.
If chip royalties roughly double by 2028 and online shops pay half what management hopes, the shares end up worth about half of today. If neither grows, shareholders keep the video royalties, about a third of today's value.
| Semiconductor and e-commerce patent licensing revenue in two to three years | Chipmaker licences needed | At the stated multiple |
|---|---|---|
| $81.00M | about 18 at 100% kept | 0.5× |
| $122.00M (the big win) | about 31 at 100% kept | 0.6× |
| $172.00M | about 47 at 100% kept | 0.6× |
To pay 2× (a Fair bet) it would need about $1.23B of Semiconductor and e-commerce patent licensing revenue (about 377 chipmaker licences); to pay 5× (a Cheap bet), about $3.52B of Semiconductor and e-commerce patent licensing revenue (about 1.1K chipmaker licences), at the same multiple.
Each row is Semiconductor and e-commerce patent licensing alone, plus the rest of the company (Media patent licensing (the rest of Adeia)) counted at about $1.20B.
The steps it has to take
- Done AMD signs a multi-year semiconductor licence
- Done RPX licenses ten e-commerce companies in one agreement
- Not started Kioxia and Sandisk minimums worked through and per-unit royalties begin due 2027-12-31
- Not started Semiconductor royalties above $100M in a year without back-payments due 2027-12-31
- Not started HBM licences renewed due 2028-12-31
- Not started A second pooled e-commerce licence like RPX's due 2027-12-31
The detail behind the label
Rating
Expensive
the big win's payoff against the 2× and 5× lines
Cheap bet at about
≈ $0.14
99% below the price (close, )
The option
0.3×
what Semiconductor and e-commerce patent licensing is worth if it works, against what the price pays for it
The evidence under this - 7 claims
C15management claimlow confidence
Management raised its long-term annual revenue target to $600M from $500M in August 2026, with semiconductors at $200M (from $100M) and media at $400M, and places 'long term' at about five years.
sourceAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- 2025 semiconductor revenue was $25.7M and Q2 2026's $14.8M annualises to $59M; the target is more than three times the run-rate and rests on adoption and relicensing dated 2027 and 2028 by management itself.
- The $500M target that preceded it was set before the DIRECTV and DISH lapses and was not lowered when they happened; the media half stays at $400M against 2025 media revenue of $417.6M that included Disney's one-off.
C16management claimmedium confidence
Management says the Kioxia and Sandisk NAND agreements of March 2023 are per-unit with minimums recognised up front, that those minimums are mostly worked through in 2027, that the royalty is a fixed amount per unit with volume discounts and does not rise with NAND prices, and that HBM relicensing falls in 2027 and 2028.
against this
- Sandisk's FY2026 10-K does not mention hybrid bonding, so the share of its NAND that is hybrid-bonded - the quantity the royalty depends on - is not disclosed by the licensee.
- Semiconductor revenue fell from $45.4M in 2023 to $18.6M in 2024 after the up-front minimums, which is what a minimum recognised at signing looks like from the outside.
C19facthigh confidence
AMD's Q2 2026 10-Q, Micron's FY2025 10-K and Sandisk's FY2026 10-K contain no mention of hybrid bonding or of Adeia; the adoption Adeia describes at its own licensees cannot be checked from the licensees' filings.
C47management claimlow confidence
The RPX agreement of 30 June 2026 licenses ten e-commerce member companies under one multi-year contract; management says e-commerce, begun about two years earlier with a first licence at the end of 2024, now has 15 customers across six agreements and could grow to about 10% of revenue, the size of the consumer-electronics business.
sourceAdeia press release - Adeia Enters into Multi-Year IP…primaryAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- No fee, term or per-member figure is disclosed; RPX describes its syndicated deals as reducing cost for members, which is a buyer negotiating a discount.
- Management would not describe the negotiation and said only that the structure 'can potentially' be replicated.
C63estimatelow confidence
Management's goal for e-commerce licensing, the size of the consumer-electronics business at about 10% of revenue, is about $44M a year on 2025's revenue of $443.4M; half of that goal is about $22M a year.
sourceAdeia Q2 2026 earnings call transcriptprimaryAdeia Inc. Form 10-K for the year ended 31 December 2025primary
against this
- No e-commerce revenue, fee or term is disclosed anywhere, and RPX describes its pooled deals as lowering members' cost, so the goal may never be met at any size (C47).
- Today's e-commerce royalties, undisclosed, sit inside the media recurring figure the bet's core values (C60), so the bet counts that part twice; it is small enough not to move the rating.
C60estimatelow confidence
If recurring revenue reaches the guided $90M a quarter and semiconductor revenue stays at Q2 2026's $14.8M, media recurring royalties are about $75M a quarter, about $300M a year.
sourceAdeia Q1 2026 earnings call transcriptprimaryAdeia Inc. Form 10-Q for the quarter ended 30 June 2026primary
against this
- Q2 2026 recurring revenue was $73.5M, 22% short of the guide, with DIRECTV and DISH unlicensed (C50).
- Not all Q2 semiconductor revenue need be recurring, so the media share could be larger or smaller.
C32facthigh confidence
The shares closed at $24.82 on 18 September 2026, up 58.1% over 252 sessions from $15.70; trailing revenue for each diluted share rose 21.9% and the price paid for each dollar of it rose 29.6%. The 52-week range is $11.61 to $34.34, the close 27.7% below the high. Trailing price to earnings is 22.0 against a six-year prior median of 10.0, EV to EBITDA 11.7 against 6.9, price to sales 5.8 against 2.8; market value $2.74B, enterprise value $3.06B.
Where we disagree with the market
The market believes
Revenue keeps growing, on chip-stacking royalties and on settlements that follow Disney's pattern.
We believe
The recurring base is smaller and more fought over than the headline, and the price already pays for the recovery and the chip target.
The market is reading the results release, which leads with headline growth and the raised $600M target. The recurring figure sits in the quarterly filing's revenue note.
We would be wrong if recurring revenue reaches $90M a quarter by the end of 2026 with neither DIRECTV nor DISH licensed, and chip royalties rise quarter after quarter.
What analysts say, and the evidence
Analysts positive
100%
of 4, 1 Sep
Four months earlier
100%
of 4, 1 May
The evidence under this - 6 claims
C04facthigh confidence
Q2 2026 revenue was $96.1M, up 12.1%; recurring revenue fell 13.6% to $73.5M from $85.1M; non-recurring revenue was $22.6M against $0.6M. For the six months recurring revenue was $147.4M against $169.5M, down 13.0%.
C15management claimlow confidence
Management raised its long-term annual revenue target to $600M from $500M in August 2026, with semiconductors at $200M (from $100M) and media at $400M, and places 'long term' at about five years.
sourceAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primaryAdeia Q2 2026 earnings call transcriptprimary
against this
- 2025 semiconductor revenue was $25.7M and Q2 2026's $14.8M annualises to $59M; the target is more than three times the run-rate and rests on adoption and relicensing dated 2027 and 2028 by management itself.
- The $500M target that preceded it was set before the DIRECTV and DISH lapses and was not lowered when they happened; the media half stays at $400M against 2025 media revenue of $417.6M that included Disney's one-off.
C34factmedium confidence
The vendor's rating panel has read 100% positive on four analysts in every monthly reading from at least January to September 2026; its revenue estimates are $416.0M for 2026 (three contributors), $451.1M for 2027 (three) and $475.0M for 2028 (one).
C12management claimmedium confidence
The chief financial officer guided quarterly recurring revenue to grow through 2026 to approximately $90M by the end of the year, full-year operating cash flow of about $150M, and year-end cash of about $100M; 2026 revenue guidance of $395M to $435M was reiterated in February, April, May and August 2026.
sourceAdeia Q1 2026 earnings call transcriptprimaryAdeia Q2 2026 earnings call transcriptprimaryAdeia Form 8-K, press release on the DISH Network litigation…primaryAdeia Q2 2026 results release, Form 8-K Exhibit 99.1primary
against this
- Recurring revenue was $73.5M in Q2 2026, so the exit rate needs a 22% rise in two quarters with DIRECTV and DISH still unlicensed (C50).
- On the Q2 call the chief financial officer said the internal forecast 'looks a lot like the consensus models', which sit near $416M, below the guide's midpoint; the chief executive said the year 'can come from various different avenues' including 'the Pay-TV items that we've got in dispute'.
C50estimatehigh confidence
Reaching the guided $90M of quarterly recurring revenue by Q4 2026 requires a 22% rise from Q2 2026's $73.5M within two quarters, with DIRECTV and DISH unlicensed.
derivedC12 gives the $90M guide; C04 gives the $73.5M; 90 over 73.5 is 1.224.
against this
- The Q1 figure was restated from $66.3M to $73.9M in the next 10-Q, so the quarterly recurring line moves with classification as well as with customers, and a further reclassification could close part of the gap.
- Kioxia and Sandisk contributed nothing in Q1 by management's account and were expected to contribute 'meaningful revenue in the following quarters', which is recurring per-unit royalty.
C14facthigh confidence
Semiconductor revenue was $25.7M in 2025, $18.6M in 2024 and $45.4M in 2023; it was $48.3M in the six months to June 2026, of which $14.8M in Q2, so $33.5M in Q1 2026. The AMD agreement signed in March 2026 included a retroactive amount recognised in Q1; management said AMD will not be a 10% customer going forward.
What could go wrong, and how we would know
The risks
- Patents struck down. In the patent office's fiscal 2025, 17% of challenges ended with every claim struck out, and Adeia's own report says asserted patents have been invalidated.
- Pay-TV shrinking. Comcast lost 9.4% of its video customers in a year, and operators pay Adeia per subscriber.
- A debt deadline. $378.0M of the term loan falls due in June 2028, against $137.1M of cash and securities today.
- Lawsuits cost money. Litigation cost $24.7M in 2025, up 81%, and management expects it to rise again in 2026.
The evidence under this - 6 claims
C21facthigh confidence
In the patent office's fiscal 2025 the board's institution rate by petition was 50% (620 of 935 decided petitions granted, before director discretionary denials), and of 1,470 petition outcomes 250 (17%) were final written decisions holding all claims unpatentable, 75 (5%) mixed, 62 (4%) all claims patentable and 368 (25%) settled.
C20facthigh confidence
The 10-K states that 'due to the exclusionary nature of patent rights, we do not compete, in a traditional sense, with other patent holders'; that US patents expire at various times through the next two decades and the last issued patent in March 2045; and that inter partes reviews 'have a high rate of invalidation of patents, and patents we have asserted in litigation have been and may continue to be invalidated'.
C24facthigh confidence
Comcast reported 10.668 million domestic video customers at 30 June 2026 against 11.771 million a year earlier, down 9.4%, and says video revenue fell 'primarily due to declines in the overall number of video customers'; Charter reported 12.524 million total video customers against 12.631 million, down 0.8%.
C25facthigh confidence
Pay-TV operators 'typically pay us a monthly per-subscriber fee'; streaming and social-media companies pay fixed fees for specified periods; consumer-electronics makers pay per unit or fixed fees; semiconductor customers pay fixed fees, per-unit, production-based or milestone fees, and some semiconductor licences convert to fully paid-up at the end of their term.
C26facthigh confidence
The term loan B stood at $392.6M at 30 June 2026 at an effective rate of 7.1% (SOFR plus 2.50%), with $24.4M of scheduled principal a year and $378.0M due at maturity on 8 June 2028; cash and marketable securities were $137.1M. Management says S&P upgraded the rating to BB in 2026 and that it intends to refinance at least twelve months before maturity.
C40facthigh confidence
Litigation expense was $24.7M in 2025, up 81%, $11.3M in the six months to June 2026, and management expects it to remain a significant portion of operating expenses and to rise year on year in 2026.
What we still do not know
- What Adeia charges per subscriber or per chip. Neither it nor any licensee says.
- When DIRECTV and DISH settle, if at all. DISH's bankruptcy has frozen the case.
- Whether its chip licensees are shipping chips stacked this way. Their own filings do not mention it.
- Why $7.7M moved from one-off to recurring revenue between two filings, with no note explaining it.
The evidence under this - 4 claims
C25facthigh confidence
Pay-TV operators 'typically pay us a monthly per-subscriber fee'; streaming and social-media companies pay fixed fees for specified periods; consumer-electronics makers pay per unit or fixed fees; semiconductor customers pay fixed fees, per-unit, production-based or milestone fees, and some semiconductor licences convert to fully paid-up at the end of their term.
C44inferencemedium confidence
A DIRECTV or DISH settlement would repeat the Disney pattern - a one-time catch-up recognised at signing and a resumed recurring stream - but its timing and size are less certain than Disney's or AMD's: DISH's case is stayed by a bankruptcy that its parent expects to leave by the end of Q3 2026, DIRECTV sued first and won the first motion, and both can challenge the patents at the board.
derivedC22 gives the three prior settlements and their durations; C06, C07 and C08 give the state of the two disputes; C21 gives the board's outcomes; the exit date is EchoStar's public statement as reported in coverage, not read from a filing.
against this
- Every refusal Adeia has litigated against a large US counterparty since the separation has ended in a licence within about a year, and DISH's own prepackaged plan keeps DISH TV and Sling operating as normal.
- A settlement with either would carry back-royalties from the lapse date, so a resolution in 2027 could produce a quarter like Q4 2025.
C19facthigh confidence
AMD's Q2 2026 10-Q, Micron's FY2025 10-K and Sandisk's FY2026 10-K contain no mention of hybrid bonding or of Adeia; the adoption Adeia describes at its own licensees cannot be checked from the licensees' filings.
C13facthigh confidence
The Q1 2026 10-Q reported Q1 recurring revenue of $66.3M and non-recurring of $38.5M; the Q2 2026 10-Q's six-month figures of $147.4M recurring and $53.5M non-recurring imply Q1 figures of $73.9M and $30.9M - $7.7M moved from non-recurring to recurring between filings, with no note explaining the change.
What would change our view
- Unattractive→NeutralDIRECTV and DISH are signed rather than litigated
It needs all of:
- ○DIRECTV and DISH both sign multi-year licences, with a one-time catch-up payment and royalties resuming, as Disney's did.watched as it happens
- ○Recurring revenue reaches the promised $90M a quarter, up 22% from the June quarter's $73.5M, with catch-up payments left out.checked at the next results, due by 2 Nov
- Unattractive→AttractiveThe semiconductor line grows past the Pay-TV question
It needs all of:
- ○Chip royalties, leaving out payments for past use, exceed $100M in 2027.checked at the next results, due by 2 Nov
- ○The $392.6M term loan is refinanced or repaid before its June 2028 deadline.watched as it happens
We would also be wrong if
- Revenue outside pay-TV keeps growing faster than 30% a year through 2027.
What is coming
- 12 October 2026 Dipti Vachani starts as chief executive: Whether the new chief executive keeps the 2026 guide and the litigation stance on DIRECTV and DISH, or resets them on her first call.
Every dated event ahead
- 12 October 2026 Dipti Vachani starts as chief executive: Whether the new chief executive keeps the 2026 guide and the litigation stance on DIRECTV and DISH, or resets them on her first call.
- 2 November 2026 Q3 2026 results: Whether recurring revenue climbs from $73.5M toward the $90M exit rate without a settlement inside it, and whether the $395M to $435M guide holds.
- February 2027 Q4 2026 results and the 2027 outlook: Whether the $90M quarterly exit rate was reached and what 2027 assumes for DIRECTV and DISH, and the next proxy's pay goals.
- June 2027 Term loan refinanced ahead of the June 2028 maturity: Whether the $378.0M balloon is refinanced a year early, as management intends, and at what rate.
Since we wrote this
Written
19 Sep
Price the thesis read
$24.82
18 Sep
- 22 OctNewsAdeia renews its patent licence with TV maker TCL, terms unread. View heldAdeia renews its IP license agreement with TCL.
- 11 OctThesis reviewThe chip-licensing line declared early and priced as a betThe owner's rule of 2026-10-11: every thesis names the lines its story rides, and an early line owes a bet that cannot be declined.
- 11 OctThesis reviewThe chip and e-commerce lines priced as one betThe owner's rule of 2026-10-11: a thesis carries one bet, so its early lines fold into one business.
- 6 OctNewsAdeia renews its patent licence with Charter's Spectrum, terms unread. View heldAdeia renews its IP license agreement with Spectrum.
- 5 OctThesis reviewThe long case now sits under the verdictAfter the five-name pilot, the owner asked for the long case on every thesis.
- 4 OctThesis reviewOwner's checklist: revenue streams, cost of growth, management, catalystsThe owner's checklist found the method silent on who runs the company, what growth costs, where the money comes from and what is dated ahead; this pass fills those four blocks from the proxy and filings.
- 29 SepNewsChief executive successor named; view heldDipti Vachani, ex-Arm, takes over on 12 October. The case rests on recurring royalties and the two unsigned customers, which a new chief executive does not change before the November results.
- 19 SepThesis writtenUnattractive, medium convictionWritten after a quarter in which recurring royalties fell 13.6% as DIRECTV and DISH stopped paying, with the shares still 58.1% higher than a year before.
Also checked 1 time with nothing new to act on.
Sources 34
Where this came from
Sources - 34
Every claim above cites one of these, or states the reasoning that derived it. The quote is frozen at the date it was read: a link can rot, and an agent fetch returns a reading of a page rather than the page. Backs counts the whole claim ledger, so it can name a claim this page does not surface.
- S01primarycompany filing2026-02-26The business description, the customer types and fee structures, the named licensees, the patent count and expiry, the competition statement, the concentration table and the five-customer figure, the revenue note with the recurring split and the $91.1M of prior-period performance obligations, the media and semiconductor split, the legal proceedings on Disney, DIRECTV, AMD, Shaw, Bell and Videotron, the term loan terms, the buyback history and the headcount.backsC01C02C03C06C09C10C14C20C22C25C26C28C40C45C46C48C55C58C59C61C63
- S02primarycompany filing2026-08-05Recurring and non-recurring revenue for the quarter and half, the media and semiconductor split, the MD&A attribution of the recurring decline to Pay-TV customers, the customer concentration table, remaining performance obligations by year, the term loan balance and rate, and Part II legal proceedings on DIRECTV, DISH, Fubo, Shaw, the Canadian cases and the settled Disney and AMD matters.backsC04C05C06C07C10C13C14C26C27C29C32C40C55C60
- S03primarycompany filing2026-08-03The income statement, balance sheet and cash-flow statement, the GAAP to non-GAAP reconciliations, the reiterated 2026 outlook, the raised $600M long-term target, the Google, RPX and L'Oréal agreements, the buyback and dividend figures.backsC12C15C26C27C28C30C32C39C47C49C52
- S04primarytranscript2026-08-03Adeia Q2 2026 earnings call transcriptThe 54% non-Pay-TV recurring growth and the nearly-double ratio, the semiconductor revenue of $14.8M for the quarter and $48.3M for the half, the five-year framing of the $200M target, the renewal rate over 90%, the $150M cash-flow and $100M year-end cash guide, the CEO search update and the Fubo suit. Ten analyst turns from four analysts are a separate origin: Scott Searle on the DIRECTV and DISH hits, Hamed Khorsand on the guide's low end, Matthew Galinko on RPX.
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.
backsC11C12C15C23C34C47C49C62C63 - S05primarycompany filing2026-02-23Q4 2025 revenue of $182.6M, the Disney agreement, the Microsoft agreement, the Vodafone and MLB deals, the full-year figures, the initial 2026 outlook and the Q4 income statement.backsC03C22C23C30C52
- S06primarytranscript2026-02-23Adeia Q4 2025 earnings call transcriptThe Pay-TV share guide, the DIRECTV statement, the Q4 recurring split near 50-50, semiconductor revenue of $18M in 2024 and $26M in 2025, the NAND minimums and per-unit pricing, the 2027 and 2028 relicensing window, the OTT share and the 30% to 35% OTT revenue expectation, the leadership realignment. Analyst questions from Kevin Cassidy, Scott Searle and Hamed Khorsand are a separate origin.
We are now anticipating Pay-TV will represent approximately 35% to 40% of our forecasted revenue this year. We are closely monitoring and taking direct action to challenges within our Pay-TV licensing program. Specifically, DIRECTV has filed certain litigation, which ultimately challenges the need for a new license agreement. ... I would also just add, Scott, on NAND just as a reminder, we signed the deals with Kioxia and SanDisk in March of 2023. At that time, they had no NAND products that utilized hybrid bonding. ... we'll pretty much fundamentally work through most of those minimums in '27, so it will be more pronounced then.
backsC11C16C40C43C45 - S07primarytranscript2026-05-04Adeia Q1 2026 earnings call transcriptThe Q1 and Q4 recurring figures, the $90M exit-rate guide, the DISH expiry at the end of March, the AMD retroactive component and the 10% remark, the S&P upgrade to BB, the refinancing timing and the $300M to $400M debt comfort range, the CEO's departure announcement, and the 85-15 internal-external portfolio split. Analyst questions are a separate origin.
Our recurring revenue during Q1 was $66.3 million as compared to $94.5 million in the prior quarter. The decrease in our recurring revenue was due to both subscriber declines and the timing of renewals with certain pay-TV customers.
backsC07C11C12C14C22C26C37C49C60 - S08primarycompany filing2026-05-06Q1 2026 recurring revenue of $66,258K and non-recurring of $38,514K as first filed - the figures the Q2 10-Q's half-year totals no longer agree with.backsC13
- S09primarycompany filing2026-04-01The five-patent complaint in Colorado, the statement that DISH and its predecessors licensed the portfolio for decades, and the outlook reiterated the day the licence lapsed.backsC07C12
- S10primarycompany filing2026-07-01The four-patent complaint in Delaware and the statement that the Disney licence is separate from the Fubo claims.backsC38
- S11primarycompany filing2025-02-19The prior year's licensed-operator list, which named AT&T including DirecTV and DirecTV Stream, and the five-customer concentration of 49.6%.backsC09C59
- S12primarycompany filing2026-07-28The 22 July 2026 compensation committee action adding benefits on a qualifying termination for the three officers, during the CEO search.backsC37
- S13primarycompany filing2026-08-076.391 million Pay-TV subscribers at 30 June 2026; the Adeia note with the five patents by number and title, the description of Adeia as not practising its claims, the treble-damages and injunction language, and the notice of automatic stay after the 30 June 2026 Chapter 11 filing.backsC08
- S14primarycompany filing2026-07-23Domestic video customers of 10.668 million against 11.771 million a year earlier, and the attribution of lower video revenue to the decline in video customers.backsC24
- S15primarycompany filing2026-07-24Total video customers of 12.524 million against 12.631 million a year earlier.backsC24
- S16primarycompany filing2026-08-05Fubo's account of the Adeia complaint, the four patents, the response deadline of 21 September 2026 and its inability to estimate a loss.backsC38
- S17primarycompany filing2026-01-23Foveros Direct with hybrid-bonding support planned on Intel 18A-PT in 2028 - a logic maker dating its own adoption, from outside Adeia.backsC18
- S18primarycompany filing2026-04-16TSMC-SoIC named as TSMC's own chip-stacking manufacturing service, with no licence and no Adeia mentioned.backsC18
- S19primarycompany release2026-07-23Orders of €292.9M, up 128.8% on Q2-25, and hybrid bonding named as a growth driver - the tool maker's own measure of adoption.
Revenue of € 249.9 million grew € 65.0 million, or 35.2%, vs. Q1-26 and € 101.8 million, or 68.7%, vs. Q2-25 due primarily to broad based growth, particularly for hybrid bonding, photonics and datacenter applications ... Orders of € 292.9 million rose 8.6% vs. Q1-26 due primarily to increased demand for datacenter, photonics and AI power management applications. Vs. Q2-25, up 128.8% due to broad based growth, particularly for AI computing applications
backsC17 - S20primaryregulator2025-09-30The FY2025 institution rate by petition of 50% (66% of the 935 Board decisions granted, 620, before director discretionary denials) and the outcome distribution above - the regulator's own measure of what a challenge to a patent achieves.
Denied 315 (34%) Granted 620 (66%) Denied 304 (60%) Referred 201 (40%) 935 Total 505 Total Board DSCO Disposition rates by decision type FY 25: Oct. 1, 2024 to Sept. 30, 2025 ... FY 21 FY 22 FY 23 FY 24 FY 25 769 752 740 702 504 398 375 347 68% 67% 66% 50% ... Settled 368 (25%) DSCO Denied 302 (21%) Req. Adverse Judgment 36 (2%) Dismissed 35 (2%) Institution Denied 342 (23%) FWD All Unpatentable 250 (17%) FWD Mixed 75 (5%) FWD All Patentable 62 (4%) 1,470 Total
backsC21 - S21secondaryvendor data2026-09-19Research pack, ADEA, built 2026-09-19Price, returns, the 52-week range, the price-move decomposition, trailing multiples against prior medians, the analyst rating series and estimates, the earnings history with filed GAAP figures beside adjusted, FINRA short interest, the insider window and base rate, the headcount series citing the 10-K, and the valuation cross-check against the filed revenue.backsC32C34C35C36C48C52
- S22primarycompany filing2026-05-15A 99,342-share open-market sale at $31.75 with no Rule 10b5-1 plan flag, read by scripts/insider_fetch.py.backsC36
- S23primarycompany filing2026-02-05The licensing model and buyer types for the cohort gate; 2025 revenue of $834.0M with $277.4M of catch-up revenue against $868.5M and $460.1M in 2024; the Smartphone $678.9M and CE, IoT/Auto $154.6M split.backsC53
- S24primarycompany filing2026-02-18Its own description as a chip and silicon-IP company - the reason it was refused as a peer.read, but no claim rests on it
- S25primarycompany filing2026-02-26Its product business and its Competition section naming guide and audio makers - the reason it was refused as a peer.read, but no claim rests on it
- S26primarycompany filing2026-08-05An absence: no mention of Adeia or of hybrid bonding in the licensee's own quarterly report.backsC19
- S27primarycompany filing2025-10-03An absence: no mention of hybrid bonding in a named semiconductor licensee's annual report.backsC19
- S28tertiarynews2026-07-23The hybrid-bonding customer count from Besi's results presentation, second-hand; the presentation itself was not reached.
Hybrid bonding customer adoption increased from 15 customers at year-end 2025 to 21 customers by the end of Q2 2026
backsC51 - S29primarycompany release2026-05-12The renewal, the customer-since date, and the absence of any term or fee.
The renewal provides Google, a customer since 2012, with broad access to Adeia's media IP portfolio.
backsC23 - S30primarycompany release2026-06-30The ten-member structure, the e-commerce technologies covered, RPX's description of syndicated deals as reducing cost and friction for members, and no fee or term.
Under the agreement, RPX has secured rights for 10 participating member companies to access Adeia's media intellectual property portfolio
backsC47 - S31primarycompany filing2026-08-17An absence: no mention of hybrid bonding or wafer bonding in a named NAND licensee's annual report.backsC19
- S32primaryregulator2024-12-30The WHOLE US Pay-TV base and its rate of decline, which no licensee's filing can give - a filer reports its own subscribers and never the market. Note the provenance honestly: the FCC compiles these figures from S&P Global rather than counting them itself, so this is a regulator publishing an industry aggregate, not a government census.
Figure II.E.1 shows that collectively, the number of traditional MVPD subscribers fell from 61.9 million at the end of 2022 to 54.1 million at the end of 2023, which represents a loss of 7.8 million video subscribers. ... In 2023, 65.3% of MVPD subscribers subscribed to cable while 25.3% subscribed to DBS and 9.4% subscribed to telephone companies. ... Figure II.E.3 shows the number of subscribers and market shares for the largest traditional MVPDs at the end of 2023. These MVPDs served approximately 92% of all traditional MVPD subscribers.
backsC54 - S33primarycompany filing2026-09-28The successor, her start date, her pay and severance terms, and the outgoing chief executive's consulting agreement to 31 December 2026.backsC37
- S34primarycompany filing2026-03-25Beneficial ownership at 9 March 2026, the executive officers' biographies and tenure, the 2025 bonus weights, goals and payouts, the PSU and RSU design, and the 2025 capital-allocation highlights.backsC56C57