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☑						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

    For the transition period from                      to                     

Pennsylvania						82-4936666
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, par value $0.01 per share			IDCC			Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Large accelerated filer			☑			Accelerated filer			☐
Non-accelerated filer			☐			Smaller reporting company			☐
Emerging growth company			☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

Common Stock, par value $0.01 per share			30,870,021
Title of Class			Outstanding at May 3, 2022

			PAGES
Part I — Financial Information:			3
Item 1 Financial Statements (unaudited):			3
Condensed Consolidated Balance Sheets — March 31, 2022 and December 31, 2021			3
Condensed Consolidated Statements of Income — Three Months Ended March 31, 2022 and 2021			4
Condensed Consolidated Statements of Comprehensive Income — Three Months Ended March 31, 2022 and 2021			5
Condensed Consolidated Statements of Shareholders Equity — Three Months Ended March 31, 2022 and 2021			6
Condensed Consolidated Statements of Cash Flows — Three Months Ended March 31, 2022 and 2021			7
Notes to Condensed Consolidated Financial Statements			8
Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3 Quantitative and Qualitative Disclosures About Market Risk			29
Item 4 Controls and Procedures			30
Part II — Other Information:			31
Item 1 Legal Proceedings			31
Item 1A Risk Factors			31
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds			31
Item 4 Mine Safety Disclosures			31
Item 6 Exhibits			32
SIGNATURES			33

InterDigital® is a registered trademark of InterDigital, Inc. All other trademarks, service marks and/or trade names appearing in this Quarterly Report on Form 10-Q are the property of their respective holders.

Item 1. FINANCIAL STATEMENTS

			MARCH 31, 2022						DECEMBER 31, 2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents			$	783,016					$	706,282
Short-term investments			116,204						235,345
Accounts receivable, less allowances of $322 and $322			23,638						31,113
Prepaid and other current assets			78,355						77,545
Total current assets			1,001,213						1,050,285
PROPERTY AND EQUIPMENT, NET			12,315						13,377
PATENTS, NET			382,286						363,585
DEFERRED TAX ASSETS			95,998						98,408
OTHER NON-CURRENT ASSETS, NET			104,215						102,501
Total non-current assets			594,814						577,871
TOTAL ASSETS			$	1,596,027					$	1,628,156
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable			$	6,013					$	7,155
Accrued compensation and related expenses			20,754						32,638
Deferred revenue			238,626						291,673
Dividends payable			10,803						10,741
Other accrued expenses			32,416						29,354
Total current liabilities			308,612						371,561
LONG-TERM DEBT			424,100						422,745
LONG-TERM DEFERRED REVENUE			51,869						19,463
OTHER LONG-TERM LIABILITIES			50,780						61,470
TOTAL LIABILITIES			835,361						875,239
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Preferred Stock, $0.10 par value, 14,399 shares authorized, 0 shares issued and outstanding			—						—
Common Stock, $0.01 par value, 100,000 shares authorized, 71,883 and 71,720 shares issued and 30,852 and 30,689 shares outstanding			718						717
Additional paid-in capital			715,342						713,599
Retained earnings			1,448,138						1,441,105
Accumulated other comprehensive loss			(881)						(571)
			2,163,317						2,154,850
Treasury stock, 41,031 and 41,031 shares of common stock held at cost			1,409,611						1,409,611
Total InterDigital, Inc. shareholders’ equity			753,706						745,239
Noncontrolling interest			6,960						7,678
Total equity			760,666						752,917
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY			$	1,596,027					$	1,628,156

			For the Three Months Ended March 31,
			2022						2021
REVENUES:
Patent licensing royalties			$	101,079					$	80,173
Technology solutions			239						2,190
Total Revenue			101,318						82,363
OPERATING EXPENSES:
Patent administration and licensing			42,095						36,574
Development			17,612						22,583
Selling, general and administrative			10,884						11,217
Restructuring activities			542						—
Total Operating expenses			71,133						70,374
Income from operations			30,185						11,989
INTEREST EXPENSE			(5,515)						(6,990)
OTHER (EXPENSE) INCOME, NET			(1,005)						724
Income before income taxes			23,665						5,723
INCOME TAX PROVISION			(5,961)						(1,765)
NET INCOME			$	17,704					$	3,958
Net loss attributable to noncontrolling interest			(290)						(1,613)
NET INCOME ATTRIBUTABLE TO INTERDIGITAL, INC.			$	17,994					$	5,571
NET INCOME PER COMMON SHARE — BASIC			$	0.59					$	0.18
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — BASIC			30,703						30,836
NET INCOME PER COMMON SHARE — DILUTED			$	0.58					$	0.18
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — DILUTED			31,275						31,195

			For the Three Months Ended March 31,
			2022						2021
Net income			$	17,704					$	3,958
Unrealized loss on investments, net of tax			(310)						(70)
Comprehensive income			$	17,394					$	3,888
Comprehensive loss attributable to noncontrolling interest			(290)						(1,613)
Total comprehensive income attributable to InterDigital, Inc.			$	17,684					$	5,501

			Common Stock												Additional  Paid-In Capital						Retained Earnings						Accumulated Other Comprehensive  Loss						Treasury Stock												Non-Controlling Interest						Total Shareholders' Equity
			Shares						Amount																								Shares						Amount
BALANCE, DECEMBER 31, 2020			71,389						$	714					$	738,481					$	1,413,969					$	(184)					40,573						$	(1,379,611)					$	23,197					$	796,566
Adjustment to Retained Earnings related to adoption of ASU 2020-06			—						—						(55,349)						15,587						—						—						—						—						(39,762)
Net income attributable to InterDigital, Inc.			—						—						—						5,571						—						—						—						—						5,571
Net loss attributable to noncontrolling interest			—						—						—						—						—						—						—						(1,613)						(1,613)
Noncontrolling interest distribution			—						—						—						—						—						—						—						(1,109)						(1,109)
Net change in unrealized loss on short-term investments			—						—						—						—						(70)						—						—						—						(70)
Dividends declared ($0.35 per share)			—						—						210						(10,976)						—						—						—						—						(10,766)
Exercise of common stock options			32						—						737						—						—						—						—						—						737
Issuance of common stock, net			55						—						(2,962)						—						—						—						—						—						(2,962)
Amortization of unearned compensation			—						—						2,153						—						—						—						—						—						2,153
Repurchase of common stock			—						—						—						—						—						91						(5,750)						—						(5,750)
BALANCE, MARCH 31, 2021			71,476						$	714					$	683,270					$	1,424,151					$	(254)					40,664						$	(1,385,361)					$	20,475					$	742,995

			Common Stock												Additional  Paid-In Capital						Retained Earnings						Accumulated Other Comprehensive  Loss						Treasury Stock												Non-Controlling Interest						Total Shareholders' Equity
			Shares						Amount																								Shares						Amount
BALANCE, DECEMBER 31, 2021			71,720						$	717					$	713,599					$	1,441,105					$	(571)					41,031						$	(1,409,611)					$	7,678					$	752,917
Net income attributable to InterDigital, Inc.			—						—						—						17,994						—						—						—						—						17,994
Net loss attributable to noncontrolling interest			—						—						—						—						—						—						—						(290)						(290)
Noncontrolling interest distribution			—						—						—						—						—						—						—						(1,928)						(1,928)
Noncontrolling interest contribution			—						—						—						—						—						—						—						1,500						1,500
Net change in unrealized loss on short-term investments			—						—						—						—						(310)						—						—						—						(310)
Dividends declared ($0.35 per share)			—						—						158						(10,961)						—						—						—						—						(10,803)
Exercise of common stock options			24						—						1,226						—						—						—						—						—						1,226
Issuance of common stock, net			139						1						(5,027)						—						—						—						—						—						(5,026)
Amortization of unearned compensation			—						—						5,386						—						—						—						—						—						5,386
BALANCE, MARCH 31, 2022			71,883						$	718					$	715,342					$	1,448,138					$	(881)					41,031						$	(1,409,611)					$	6,960					$	760,666

			For the Three Months Ended March 31,
			2022						2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income			$	17,704					$	3,958
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization			19,282						19,861
Non-cash interest expense, net			1,498						1,819
Change in deferred revenue			(50,741)						(23,429)
Deferred income taxes			2,492						(1,817)
Share-based compensation			5,386						2,153
Decrease (Increase) in assets
Receivables			7,475						3,507
Deferred charges and other assets			(2,772)						631
Increase (Decrease) increase in liabilities:
Accounts payable			420						(291)
Accrued compensation and other expenses			(18,716)						(16,234)
Net cash used in operating activities			(17,972)						(9,842)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments			(2,139)						(173,120)
Sales of short-term investments			119,950						137,174
Purchases of property and equipment			(337)						(387)
Capitalized patent costs			(9,872)						(9,602)
Long-term investments			—						(1,091)
Net cash provided by (used in) investing activities			107,602						(47,026)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from exercise of stock options			1,226						737
Repurchase of common stock			—						(5,750)
Non-controlling interest contribution			1,500						—
Non-controlling interest distribution			—						(1,109)
Taxes withheld upon restricted stock unit vestings			(5,026)						(2,962)
Dividends paid			(10,741)						(10,786)
Net cash used in financing activities			(13,041)						(19,870)
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH			76,589						(76,738)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD			713,224						477,663
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD			$	789,813					$	400,925

The accompanying notes are an integral part of these statements.

1. BASIS OF PRESENTATION

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

InterDigital has analyzed the impact of the ongoing Coronavirus pandemic (“COVID-19”) on its financial statements as of March 31, 2022.  InterDigital has determined that the changes to its significant judgments and estimates as a result of COVID-19 did not have a material impact on its financial statements.  The potential impact of COVID-19 will continue to be analyzed going forward.

There have been no material changes or updates to our existing accounting policies from the disclosures included in our 2021 Form 10-K, except as indicated below in "New Accounting Guidance".

As previously disclosed in our 2021 Form 10-K filed with the SEC on February 17, 2022, during the fourth quarter of 2021, we determined that in our first quarter 2021 adoption of ASU 2020-06, Accounting for Convertible Debt, we incorrectly accounted for the adoption by increasing debt and decreasing retained earnings by $50.2 million, which resulted in a $10.4 million understatement of deferred taxes, $65.8 million understatement of retained earnings and $55.4 million overstatement of additional paid-in capital as of March 31, 2021. While we concluded that this error did not result in our previously issued 2021 interim financial statements being materially misstated, we have corrected the misstatement by revising the accompanying Condensed Consolidated Statement of Shareholder’s Equity as of and for the three months ended March 31, 2021. We will prospectively revise our previously issued financial statements as of and for the interim periods ended June 30, 2021 and September 30, 2021 in connection with our second quarter and third quarter 2022 quarterly filings on Form 10-Q. The accompanying annual footnotes have also been adjusted to reflect such correction.

Certain reclassifications have been made to prior year amounts to conform to the current year presentation.

			For the Three Months Ended March 31,
SUPPLEMENTAL CASH FLOW INFORMATION:			2022						2021
Income taxes paid, including foreign withholding taxes			$	3,349					$	4,328
Non-cash investing and financing activities:
Dividend payable			10,803						10,766
Non-cash acquisition of patents			30,100						—
Non-cash distribution of patents			1,928						—
Accrued capitalized patent costs and property and equipment			1,562						2,096
Unsettled repurchase of common stock			—						1,994

In May 2021, the FASB issued ASU No. 2021-04. The amendments in this ASU are intended to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options, including warrants, that remain equity classified after modification or exchange. ASU 2021-04 is effective for fiscal years beginning after December 15, 2021, with early adoption allowed. We adopted this guidance as of January 1, 2022 and the adoption did not have a material impact on our consolidated financial statements.

2. REVENUE

			Three months ended March 31,
			2022						2021						Increase/(Decrease)
Variable patent royalty revenue			$	9,045					$	7,096					$	1,949					27		%
Fixed-fee royalty revenue			89,843						69,296						20,547						30		%
Current patent royalties a			98,888						76,392						22,496						29		%
Non-current patent royalties b			2,191						3,781						(1,590)						(42)		%
Total patent royalties			101,079						80,173						20,906						26		%
Current technology solutions revenue a			239						2,190						(1,951)						(89)		%
Total revenue			$	101,318					$	82,363					$	18,955					23		%

a.    Recurring revenues are comprised of current patent royalties, inclusive of dynamic fixed-fee royalty payments, and current technology solutions revenue.

b.    Non-recurring revenues are comprised of non-current patent royalties, which include past patent royalties and royalties from static agreements, as well as patent sales.

Based on contracts signed and committed as of March 31, 2022, we expect to recognize the following revenue from dynamic fixed-fee royalty payments over the term of such contracts (in thousands):

			Revenue
Remainder of 2022			$	234,529
2023			121,711
2024			73,297
2025			60,920
2026 and thereafter			—
Total Revenue			$	490,457

3. INCOME TAXES

During the three months ended March 31, 2022 and 2021, the Company paid approximately $3.2 million and $3.6 million, respectively, in foreign source creditable withholding tax.

4. NET INCOME PER SHARE

Basic Earnings Per Share ("EPS") is calculated by dividing net income or loss available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if options or other securities with features that could result in the issuance of common stock were exercised or converted to common stock or resulting from the unvested outstanding restricted stock units ("RSUs"). The following tables reconcile the numerator and the denominator of the basic and diluted net income per share computation (in thousands, except for per share data):

			Three months ended March 31,
			2022						2021
Net income applicable to InterDigital, Inc.			$	17,994					$	5,571
Weighted-average shares outstanding:
Basic			30,703						30,836
Dilutive effect of stock options, RSUs, convertible securities and warrants			572						359
Diluted			31,275						31,195
Earnings per share:
Basic			$	0.59					$	0.18
Dilutive effect of stock options, RSUs, convertible securities and warrants			(0.01)						—
Diluted			$	0.58					$	0.18

			Three months ended March 31,
			2022						2021
Restricted stock units and stock options			414						120
Warrants			4,921						4,921
Total			5,335						5,041

5. LITIGATION AND LEGAL PROCEEDINGS

The UK High Court held case management conferences on October 6, 2020, and December 16, 2020, a disclosure hearing on January 19, 2021, and pre-trial review hearings for the first trial on January 28, 2021, and February 8, 2021. At those hearings, the UK High Court entered a schedule for the technical and non-technical FRAND proceedings. Two technical trials were scheduled for March 2021 and June 2021, and the non-technical FRAND trial was scheduled for January 2022. There are three additional technical trials scheduled for the remaining patents following the FRAND trial. The first and second technical trials were completed, and on July 29, 2021, the UK High Court issued its decision regarding the first technical trial finding European Patent (UK) No. 2,485,558 valid, infringed, and essential to Release 8 of LTE. Lenovo is appealing this decision. On January 6, 2022, the UK High Court issued its decision regarding the second technical trial finding European Patent (UK) No. 3,355,537 invalid, but essential and infringed but for the finding of invalidity. The Company plans to appeal the second technical trial decision as legally erroneous. The FRAND trial commenced on January 11, 2022 and concluded on February 11, 2022. The third technical trial is scheduled to commence on May 10, 2022, to be completed by May 18, 2022.

On September 16, 2020, the Delaware District Court entered a schedule for the case, setting a patent jury trial. On March 8, 2021, the Delaware District Court held a claim construction hearing, and the court issued its order on May 10, 2021, construing various disputed terms. On March 24, 2021, the Delaware District Court consolidated the antitrust proceeding discussed below with this patent proceeding. Trial for the consolidated proceedings is scheduled for March 6, 2023. On April 25, 2022, the parties filed a stipulation to stay only the claims relating to U.S. Patent No. 8,199,726.

On March 24, 2021, the Delaware District Court ruled on the Company’s motion to dismiss. The Delaware District Court dismissed the Sherman Act Section 1 claim without prejudice, denied the motion to dismiss the Sherman Act Section 2 claim, and consolidated the Section 2 and breach of contract claims with Company’s Delaware patent proceeding discussed above.

6. CASH, CONCENTRATION OF CREDIT RISK AND FAIR VALUE OF FINANCIAL INSTRUMENTS

			March 31,						December 31,						March 31,
			2022						2021						2021
Cash and cash equivalents			$	783,016					$	706,282					$	396,156
Restricted cash included within prepaid and other current assets			5,716						5,861						3,688
Restricted cash included within other non-current assets			1,081						1,081						1,081
Total cash, cash equivalents and restricted cash			$	789,813					$	713,224					$	400,925

Level 1 Inputs — Level 1 includes financial instruments for which quoted market prices for identical instruments are available in active markets.

Level 2 Inputs — Level 2 includes financial instruments for which there are inputs other than quoted prices included within Level 1 that are observable for the instrument such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets with insufficient volume or infrequent transactions (less active markets) or model-driven valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data, including market interest rate curves, referenced credit spreads and pre-payment rates.

Level 3 Inputs — Level 3 includes financial instruments for which fair value is derived from valuation techniques including pricing models and discounted cash flow models in which one or more significant inputs are unobservable, including the Company’s own assumptions. The pricing models incorporate transaction details such as contractual terms, maturity and, in certain instances, timing and amount of future cash flows, as well as assumptions related to liquidity and credit valuation adjustments of marketplace participants.

			Fair Value as of March 31, 2022
			Level 1						Level 2						Level 3						Total
Assets:
Money market and demand accounts (a)			$	789,813					$	—					$	—					$	789,813
Commercial paper (b)			—						48,151						—						48,151
U.S. government securities			—						46,591						—						46,591
Corporate bonds, asset backed and other securities			—						21,462						—						21,462
Total			$	789,813					$	116,204					$	—					$	906,017

			Fair Value as of December 31, 2021
			Level 1						Level 2						Level 3						Total
Assets:
Money market and demand accounts (a)			$	705,725					$	—					$	—					$	705,725
Commercial paper(b)			—						158,452						—						158,452
U.S. government securities			—						51,301						—						51,301
Corporate bonds, asset backed and other securities			—						33,091						—						33,091
Total			$	705,725					$	242,844					$	—					$	948,569

(a)Primarily included within cash and cash equivalents.

(b)As of March 31, 2022 and December 31, 2021, $0.0 million and $7.5 million, respectively, of commercial paper was included within cash and cash equivalents.

			March 31, 2022																		December 31, 2021
			Principal Amount						Carrying Value						Fair Value						Principal Amount						Carrying Value						Fair Value
Senior Convertible Long-Term Debt			$	400,000					$	396,056					$	410,240					$	400,000					$	395,632					$	437,760

			March 31, 2022												December 31, 2021
			Carrying Value						Fair Value						Carrying Value						Fair Value
Technicolor Patent Acquisition Long-Term Debt			$	28,044					$	28,731					$	27,113					$	28,569

7. OBLIGATIONS

Upon our assumption of Technicolor’s rights and obligations under the Madison Arrangement, our relationship with CPPIB Credit meets the criteria in ASC 470-10-25 - Sales of Future Revenues or Various Other Measures of Income ("ASC 470"), which relates to cash received from an investor in exchange for a specified percentage or amount of revenue or other measure of income of a particular product line, business segment, trademark, patent, or contractual right for a defined period. Under this guidance, we recognized the fair value of our contingent obligation to CPPIB Credit, as of the acquisition date, as long-term debt in our condensed consolidated balance sheet. This initial fair value measurement was based on the perspective of a market participant and included significant unobservable inputs which are classified as Level 3 inputs within the fair value hierarchy. The fair value of the long-term debt as of March 31, 2022 and December 31, 2021 is disclosed within Note 6, "Cash, Concentration of Credit Risk and Fair Value of Financial Instruments." Our repayment obligations are contingent upon future royalty revenues generated from the Madison Arrangement and there are no minimum or maximum payments under the arrangement.

			March 31, 2022												December 31, 2021
Principal			$	400,000											$	400,000
Less:
Deferred financing costs			(3,944)												(4,368)
Net carrying amount of the 2024 Notes			$	396,056											$	395,632

The following table presents the amount of interest cost recognized, which is included within "Interest Expense" in our condensed consolidated statements of income, for the three months ended March 31, 2022 and 2021 relating to the contractual interest coupon and the amortization of deferred financing costs of the 2024 Notes (in thousands):

			Three months ended March 31,
			2022						2021
Contractual coupon interest			$	2,000					$	2,000
Amortization of deferred financing costs			424						398
Total			$	2,424					$	2,398

8. VARIABLE INTEREST ENTITIES

As further discussed below, we are the primary beneficiary of three variable interest entities. As of March 31, 2022, the combined book values of the assets and liabilities associated with these variable interest entities included in our condensed consolidated balance sheet were $20.8 million and $2.3 million, respectively. Assets included $7.3 million of cash and cash equivalents, $4.1 million of accounts receivable and prepaid and other current assets, and $9.4 million of patents, net. As of December 31, 2021, the combined book values of the assets and liabilities associated with these variable interest entities included in our condensed consolidated balance sheet were $27.1 million and $2.5 million, respectively. Assets included $5.1 million of cash and cash equivalents, $4.0 million of accounts receivable and prepaid and other current assets, and $18.0 million of patents, net.

9. OTHER (EXPENSE) INCOME, NET

The amounts included in "Other (expense) income, net" in the condensed consolidated statements of income for the three months ended March 31, 2022 and 2021 were as follows (in thousands):

			Three months ended March 31,
			2022						2021
Interest and investment income			$	209					$	553
Other			(1,214)						171
Other (expense) income, net			$	(1,005)					$	724

Other (expense) income, net changed $1.7 million primarily due to a $1.9 million gain on a contract termination recognized in first quarter 2021.

10.    OTHER ASSETS

			March 31, 2022						December 31, 2021
Tax receivables			$	55,290					$	57,127
Prepaid assets			8,662						5,479
Restricted cash			5,716						5,861
Patents held for sale			4,000						4,000
Other current assets			4,687						5,078
Total Prepaid and other current assets			$	78,355					$	77,545

			March 31, 2022						December 31, 2021
Tax receivables			$	32,252					$	30,026
Goodwill			22,421						22,421
Right-of-use assets			17,009						17,851
Long-term investments			21,280						21,280
Other non-current assets			11,253						10,923
Total Other non-current assets, net			$	104,215					$	102,501

11.    RESTRUCTURING ACTIVITIES

Balance as of December 31, 2021			$	18,281
Accrual			542
Cash payments			(4,519)
Other			42
Balance as of March 31, 2022			$	14,346

			Three months ended March 31,
			2022						2021
Severance and other benefits			527						—
Outside services and other associated costs			15						—
Total			$	542					$	—

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion should be read in conjunction with the unaudited, condensed consolidated financial statements and notes thereto contained in Part I, Item 1 of this Quarterly Report on Form 10-Q, in addition to our 2021 Form 10-K, other reports filed with the SEC and the Statement Pursuant to the Private Securities Litigation Reform Act of 1995 — Forward-Looking Statements below.

As of March 31, 2022, we had $906.0 million of cash, cash equivalents, restricted cash and short-term investments and an additional $198.6 million of cash payments due under contracted fixed price agreements, including $6.1 million recorded in our $23.6 million accounts receivable balance. The remaining accounts receivable is primarily related to variable patent royalty revenue.

Over 90% of our revenue comes from fixed price agreements. Such agreements often have prescribed payment schedules that are uneven and sometimes front-loaded, resulting in timing differences between when we collect the cash payments and recognize the related revenue. As a result, our cash receipts due in 2022 from existing agreements are expected to be lower than revenue to be recognized in 2022 from such agreements as noted in the deferred revenue amortization table below.

The following table reconciles the timing differences between cash receipts and recognized revenue during the three months ended March 31, 2022 and 2021, including the resulting operating cash flow (in thousands):

			Three months ended March 31,
Cash vs. Non-cash revenue:			2022						2021
Fixed fee cash receipts (a)			$	42,280					$	47,312
Other cash receipts (b)			10,115						10,676
Change in deferred revenue			50,741						23,429
Change in receivables			(7,475)						(3,507)
Other			5,657						4,453
Total Revenue			$	101,318					$	82,363
Net cash used in operating activities			$	(17,972)					$	(9,842)

When we collect payments on a front-loaded basis, we recognize a deferred revenue liability equal to the cash received and accounts receivable recorded which relate to revenue expected to be recognized in future periods. That liability is then reduced as we recognize revenue over the balance of the agreement. The following table shows the projected amortization of our current and long term deferred revenue as of March 31, 2022 (in thousands):

			Revenue
Remainder of 2022			$	225,542
2023			57,331
2024			6,702
2025			920
2026 and thereafter			—
Total Revenue			$	290,495

On June 10, 2021, we announced that, as a result of a strategic review of our research and innovation priorities, we commenced the process of a collective economic layoff in which we proposed a reduction in force of our research and innovation unit. Additionally, in October 2021, we expanded our restructuring efforts to include general and administrative functions largely centered in the U.S. All impacted employees have been provided notification of termination.

During first quarter 2022, we recognized $0.5 million of restructuring expenses including $0.5 million of severance and other benefits which are included within “Restructuring Activities” in the condensed consolidated statement of income.

The COVID-19 pandemic continues to significantly impact the United States and the rest of the world. Though the COVID-19 pandemic and the measures taken to reduce its transmission, such as the imposition of social distancing and orders to work-from-home and shelter-in-place, have altered our business environment and overall working conditions, we continue to believe that our strategic strengths, including talent, our strong balance sheet, stable revenue base, and the strength of our patent portfolio, will allow us to weather a rapidly changing marketplace.

While the environment in which we conduct our business and our overall working conditions have changed as a result of the COVID-19 pandemic, we experienced a limited impact on our operations and financial position during first quarter 2022. Fixed-fee royalties accounted for 89% of our recurring revenues in fiscal year 2021. These fixed-fee revenues are not directly affected by our related licensees’ success in the market or the general economic climate. To that end, in first quarter 2022, we did not experience a significant impact on our contracted revenue due to COVID-19. Meanwhile, we have taken steps to protect the health and safety of our employees and their families, with the majority of our workforce continuing to work remotely or on a hybrid basis. We returned to in-person work as of April 2022 and all of our locations are open. Despite any remote working conditions, our business activities have continued to operate with minimal interruption, and we expect them to continue to operate efficiently. Although we have resumed work-related travel, a portion of our licensing negotiations, investor presentations and participation in standards organizations and industry events virtually. Between March 12, 2020, when we began to work almost entirely remotely, and March 31, 2022, we successfully concluded nineteen new patent license agreements that we estimate will result in revenues exceeding $570.0 million over their respective lives. Our financial position remains strong, we believe we have sufficient access to capital if needed, and we remain committed to our efforts around cost discipline.

•Our first quarter 2022 revenue includes $2.2 million of non-recurring revenue primarily related to a new agreement with Sharp signed in first quarter 2022.

•During first quarter 2022, we recognized $0.5 million of restructuring expenses. These costs resulted from our restructuring activities as described in Note 11, "Restructuring Activities", within the notes to condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, and are included within “Restructuring activities” in the condensed consolidated statement of income.

Our significant accounting policies are described in Note 2, "Summary of Significant Accounting Policies and New Accounting Guidance", in the notes to consolidated financial statements included in our 2021 Form 10-K. A discussion of our critical accounting policies, and the estimates related to them, are included in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2021 Form 10-K. There have been no material changes to our existing critical accounting policies from the disclosures included in our 2021 Form 10-K. In addition, we have analyzed the impact of COVID-19 on our financial statements as of March 31, 2022, and we have determined that the changes to our significant judgments and estimates did not have a material impact on our financial statements. Refer to Note 1, “Basis of Presentation,” in the notes to condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for updates related to new accounting pronouncements and changes in accounting policies.

Our primary sources of liquidity are cash, cash equivalents and short-term investments, as well as cash generated from operations. We believe we have the ability to obtain additional liquidity through debt and equity financings. From time to time, we may engage in a variety of transactions to augment our liquidity position as our business dictates and to take advantage of favorable interest rate environments or other market conditions, including the incurrence or issuance of debt and the refinancing or restructuring of existing debt. Based on our past performance and current expectations, we believe our available sources of funds, including cash, cash equivalents and short-term investments and cash generated from our operations, will be sufficient to finance our operations, capital requirements, debt obligations, existing stock repurchase program, dividend program, and other contractual obligations discussed below in both the short-term over the next twelve months, and the long-term beyond twelve months.

			March 31, 2022						December 31, 2021						Increase / (Decrease)
Cash and cash equivalents			$	783,016					$	706,282					$	76,734
Restricted cash included within prepaid and other current assets			5,716						5,861						(145)
Restricted cash included within other non-current assets			1,081						1,081						—
Short-term investments			116,204						235,345						(119,141)
Total cash, cash equivalents, restricted cash and short-term investments			$	906,017					$	948,569					$	(42,552)

The net decrease in cash, cash equivalents, restricted cash and short-term investments was primarily attributable to cash used in financing activities of $13.0 million, primarily related to dividend payments, cash used in investing activities of $10.2 million, excluding sales and purchases of short-term investments, and cash used in operating activities of $18.0 million. Refer to the sections below for further discussion of these items.

Cash flows used in operating activities in the first quarter 2022 and 2021 (in thousands) were as follows:

			Three months ended March 31,
			2022						2021						Increase / (Decrease)
Net cash used in operating activities			$	(17,972)					$	(9,842)					$	(8,130)

			Three months ended March 31,
			2022						2021						Increase / (Decrease)
Cash Receipts:
Patent royalties			$	52,305					$	56,107					$	(3,802)
Technology solutions			90						1,881						(1,791)
Total cash receipts			52,395						57,988						(5,593)
Cash Outflows:
Cash operating expenses a			46,465						48,360						(1,895)
Income taxes paid b			3,349						4,328						(979)
Total cash outflows			49,814						52,688						(2,874)
Other working capital adjustments			(20,553)						(15,142)						(5,411)
Cash flows used in operating activities			$	(17,972)					$	(9,842)					$	(8,130)

2024 Notes
Market Price Per Share			Shares Issuable Upon Conversion of the 2024 Notes			Shares Issuable Upon Exercise of the 2024 Warrant Transactions			Total If-Converted Method Incremental Shares			Shares Deliverable to InterDigital upon Settlement of the 2024 Note Hedge Transactions			Incremental Shares Issuable (a)
			(Shares in thousands)
$85			215			—			215			(215)			—
$90			476			—			476			(476)			—
$95			710			—			710			(710)			—
$100			921			—			921			(921)			—
$105			1,111			—			1,111			(1,111)			—
$110			1,284			25			1,309			(1,284)			25
$115			1,442			238			1,680			(1,442)			238
$120			1,587			433			2,020			(1,587)			433
$125			1,721			613			2,334			(1,721)			613
$130			1,844			779			2,623			(1,844)			779

The following table compares first quarter 2022 revenues to first quarter 2021 revenues (in thousands):

			Three months ended March 31,
			2022						2021						Total Increase/(Decrease)
Variable patent royalty revenue			$	9,045					$	7,096					$	1,949					27		%
Fixed-fee royalty revenue			89,843						69,296						20,547						30		%
Current patent royalties a			98,888						76,392						22,496						29		%
Non-current patent royalties b			2,191						3,781						(1,590)						(42)		%
Total patent royalties			101,079						80,173						20,906						26		%
Current technology solutions revenue a			239						2,190						(1,951)						(89)		%
Total revenue			$	101,318					$	82,363					$	18,955					23		%