Personal Finance

What to Look for When InterDigital Reports Earnings

IDCC Chart

IDCC Chart

IDCC data by YCharts

InterDigital's plan for the future

The company is in the business of engineering and designing mobile technology solutions and systems. Revenue is generated off of patent royalties and fees from the systems it designs for its various clients. Simply put, developing technology we will use years down the road is the name of the game for InterDigital.

While the company continues to survive off of past accomplishments and continuing work for current technology, designing a 5G mobile network is the big plan for the future. The company is betting on the next-gen network as the future driver of growth for business.

InterDigital cited a recent survey by Telecoms.com Intelligence that indicates the company could be on the right track. According to survey results, 82% of industry professionals polled see the Internet of Things being a major driver behind 5G network deployment, and 86% see rollout by the year 2020 or earlier.

In years past, new mobile network development was centered on increasing speeds and enabling data transfer primarily for consumers. Faster speeds and new network abilities like ultra-high-definition video streaming are still important for 5G developers, but other needs like a network that can handle billions of connected devices, reliability of ultra-sensitive data transmission, and traffic prioritization for machine communications are challenges facing the engineers at InterDigital.

Investors may hope for a massive boom of growth, however, it is worth noting that 68% of those polled also see a slow and gradual rollout of 5G network availability rather than an all-at-once changeover.

Short-term exuberance vs. longer-term trends

With potential revenue from current research and development still a ways off, is InterDigital's recent stock advance sustainable? That will be an area to focus on when the next earnings report comes in. As increasing free cash flow and profits provided the most recent bump in share value, investors should look for signs that expense cuts continue and are sustainable, especially with the big quarterly revenue jump expected.

Developments in 5G network technology will also be important when figuring for future business growth. Keep an ear out for progress and possible new revenue opportunities from 5G this Thursday.

A secret billion-dollar stock opportunity

The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .

Nicholas Rossolillo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

IDCC

Other Topics

Stocks

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More