v3.26.3
Segment Information
 9 Months Ended
Sep. 30, 2026
Segment Reporting [Abstract]  
Segment Information

NOTE 15 – SEGMENT INFORMATION

The Company has one reportable segment: IP Licensing. The IP Licensing segment derives revenues from license agreements to (i) its media patent portfolio and (ii) its semiconductor technologies patent portfolio, see further discussion on revenue generating activities in “Note 3 – Revenue”. The Company derives revenue primarily in North America and manages the business activities on a consolidated basis.

The accounting policies of the IP Licensing segment are the same as those described in Note 2 – Summary of Significant Accounting Policies. The Company’s Chief Executive Officer is also the chief operating decision maker (“CODM”) as defined by the authoritative guidance on segment reporting. The CODM assesses financial performance for the IP Licensing segment and decides how to allocate resources based on net income that also is reported on the statements of income as consolidated net income. Net income is also used by the CODM to monitor budget versus actual results of the IP Licensing segment. The measure of segment assets is reported on the balance sheet as total consolidated assets.

The CODM uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the IP Licensing segment or into other parts of the entity, such as for acquisitions or to return value to shareholders.

The following table presents information with respect to the Company’s IP Licensing segment revenue, significant expenses and income (in thousands):

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2026

 

 

2025

 

2026

 

 

2025

 

Revenue

 

$

80,193

 

 

$

87,339

 

$

281,082

 

 

$

260,744

 

Less:

 

 

 

 

 

 

 

 

 

 

 

Personnel related expense

 

 

26,823

 

 

 

23,165

 

 

80,519

 

 

 

70,806

 

Patent portfolio expense

 

 

10,167

 

 

 

8,853

 

 

29,251

 

 

 

26,627

 

Patent related technical sales support expense

 

 

1,194

 

 

 

1,802

 

 

3,983

 

 

 

5,135

 

Amortization expense

 

 

16,291

 

 

 

14,175

 

 

48,311

 

 

 

42,427

 

Outside services expense

 

 

4,918

 

 

 

2,929

 

 

11,138

 

 

 

10,726

 

Litigation expense

 

 

7,182

 

 

 

5,195

 

 

18,489

 

 

 

18,223

 

Interest expense

 

 

8,051

 

 

 

10,054

 

 

24,632

 

 

 

30,919

 

Other segment items (1)

 

 

2,789

 

 

 

2,735

 

 

14,998

 

 

 

15,929

 

Provision for income taxes

 

 

511

 

 

 

9,603

 

 

7,355

 

 

 

2,588

 

Segment net income

 

$

2,267

 

 

$

8,828

 

$

42,406

 

 

$

37,364

 

(1) Other segment items include facilities and other related expenses, marketing and advertising expenses, depreciation expense, travel and entertainment expenses, other income and expense, and other overhead expenses.

Revenue by Geography and Customer Concentration

While the Company’s revenue is primarily derived in North America, a portion of the Company’s revenue is derived from licensees headquartered outside of the U.S., and it is expected that this revenue will continue to account for a portion of total revenue in future periods. Revenue is attributed to geographic locations based on the billing address of each customer. The table below lists the revenue by geography for the periods indicated (in thousands, except for percentages):

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2026

 

 

2025

 

 

2026

 

 

2025

 

U.S.

 

$

59,531

 

 

 

74

%

 

$

66,212

 

 

 

76

%

 

$

216,807

 

 

 

77

%

 

$

205,635

 

 

 

79

%

Asia

 

 

17,063

 

 

 

21

 

 

 

15,148

 

 

 

17

 

 

 

52,061

 

 

 

18

 

 

 

38,427

 

 

 

15

 

Canada

 

 

54

 

 

 

—

 

 

 

3,082

 

 

 

4

 

 

 

562

 

 

 

—

 

 

 

9,305

 

 

 

4

 

Europe and Middle East

 

 

3,053

 

 

 

4

 

 

 

2,418

 

 

 

3

 

 

 

10,205

 

 

 

4

 

 

 

5,969

 

 

 

2

 

Other

 

 

492

 

 

 

1

 

 

 

479

 

 

 

—

 

 

 

1,447

 

 

 

1

 

 

 

1,408

 

 

 

—

 

Total revenue

 

$

80,193

 

 

 

100

%

 

$

87,339

 

 

 

100

%

 

$

281,082

 

 

 

100

%

 

$

260,744

 

 

 

100

%

No customer accounted for 10% or more of total revenue for the three months ended September 30, 2026. For the three months ended September 30, 2025, there were two customers that accounted for 10% or more of total revenue. For the nine months ended September 30, 2026 and 2025, one and two customers each accounted for 10% or more of total revenue, respectively. The following table sets forth revenue generated from customers which comprise 10% or more of total revenue for the periods indicated:

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2026

 

2025

 

 

2026

 

 

2025

 

Customer A

 

*

 

*

 

 

 

11.6

%

 

*

 

Customer B

 

*

 

 

19.7

%

 

*

 

 

 

19.8

%

Customer C

 

*

 

 

10.0

%

 

*

 

 

 

10.3

%

* denotes less than 10% of total revenue.

At September 30, 2026, the Company had three customers representing 22%, 20% and 11% of aggregate accounts receivable, respectively. At December 31, 2025, the Company had one customer representing 63% of aggregate accounts receivable.

Other Geography Information

At September 30, 2026 and December 31, 2025, property and equipment, net, was all located in the U.S.