Adeia Inc.

Good day, everyone. Thank you for standing by. Welcome to Adia's second quarter 2023 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the call will open up for questions. I would like to now turn the call over to Chris Cheney, Vice President of Investor Relations for Adia. Chris, please go ahead.

Good afternoon, everyone. Thank you for joining us as we share with you details of our second quarter 2023 financial results. With me on the call today are Paul Davis, our president and CEO, and Keith Jones, our CFO. Paul will share with you some general observations regarding our second quarter, and then Keith will give further details on our financial results and guidance. We will then conclude with a question and answer period. In addition to today's earnings release, there is an earnings presentation which you can access along with the webcast in the IR portion of our website. Before turning the call over to Paul, I would like to provide a few reminders. First, today's discussion contains forward-looking statements that are predictions, projections, or other statements about future events which are based on management's current expectations and beliefs, and therefore subject to risks, uncertainties, and changes in circumstances. For more information on the risks and uncertainties that could cause our actual results to differ materially from what we discussed today, please refer to the Risk Factors section in our SEC filings, including our annual report on Form 10-K and our quarterly report on Form 10-Q. Please note that the company does not intend to update or alter these forward-looking statements to reflect events or circumstances arising after this call. To enhance investors' understanding of our ongoing economic performance, we will discuss non-GAAP information during this call. We use non-GAAP financial measures internally to evaluate and manage our operations. We have therefore chosen to provide this information to enable you to perform comparisons of our operating results as we do internally. We have provided reconciliations of these non-GAAP measures to the most directly comparable GAAP measures in the earnings release, the earnings presentation, and on the investor relations section of our website. A recording of this conference call will be available on the Investor Relations website at adia.com. Now I'd like to turn the call over to our CEO, Paul Davis.

Thank you, Chris, and thank you everyone for joining us today. During the second quarter, our deal momentum continued as we signed nine agreements with a diverse group of pay TV, OTT, consumer electronics, and semiconductor customers in both domestic and international markets. We delivered another quarter of strong financial results with revenue of $83.2 million and adjusted EBITDA of $51.7 million. We paid down approximately $20 million of debt in the second quarter, bringing our debt paydown since separation to over $114 million. In addition, we are on track to expand our patent portfolios by 10% this year. I am also excited to announce that we have expanded our board with the addition of Adam Reimer. Adam is a well-respected executive with over 20 years of experience in the technology, media, and entertainment industries, and he has hands-on experience leading organizations in gaming, TV, film, music, and live streaming. With his impressive track record of driving innovation at a wide variety of organizations, I am confident Adam will be a valued addition to our board. Turning back to the quarter, our deal momentum continued. Of the nine deals we signed in Q2, eight were in media and one was in semiconductor. Within media, we signed a significant long-term license renewal with Cox Communications. With the Cox renewal, we have now signed three multi-year renewals with the top 10 USPAY TV providers in the first half of the year. These renewals continue to validate the strength of our media portfolio in this market. Additionally, we signed an important new license agreement with DAZN, a leading OTT provider of global sports programming. This is an exciting deal in an emerging market for us, and OTT will be a catalyst for our future growth as we continue to expand our customers in this market. Other deals we signed in the quarter included multi-year renewals with NCO, a domestic provider of technology services to the hospitality industry, Freeview Australia, a free digital TV service provider, Technosat, a German provider of digital video consumer electronics products, and Massalon Cable, a domestic pay TV operator. These deals illustrate the breadth of our portfolio and applicability to customers in multiple jurisdictions and markets. Our commitment to innovation drives deals with new customers and our high renewal rate, which has averaged over 90% the past several years. We grow our patent portfolios primarily through investment in internal R&D, where we strategically invest in new technologies we anticipate emerging in our core markets and beyond. Growing our IP portfolio is important for several reasons. First, it allows us to retain our current customers and thus maintains the pre-existing revenue base. Our customers benefit because they can utilize not only the patents existing in our portfolio when they initiated their license agreements, but they also typically get access to new IP we add during the term of those agreements. Second, expanding our portfolio also attracts new customers as they find value in our innovations, which enable them to differentiate their products and services in their markets. We take great pride in our long history of being pioneers and innovators in both the media and semiconductor markets. That history of success is based on being a visionary of emerging trends that drive the evolution of technology. Our R&D teams are always focused on the future and what technologies will be adopted in our customers' upcoming products. Our focus on advanced R&D and IP development have positioned us particularly well in both our media and semiconductor businesses to capitalize on the recent explosion of generative AI. In our media business, we have been investing in AI-enabling technologies such as computer vision, machine learning, and natural language processing for years. Today, our portfolio contains significant coverage in these areas, and this has helped drive license agreements in multiple verticals of our media business. And we believe these and other innovations will enable us to expand our customer base in new media verticals, such as ad tech and e-commerce. Generative AI also requires high performance computing and advancements in semiconductor technologies. The demand for emerging logic nodes, next generation high bandwidth memory, and advanced system packaging is increasing to meet those needs. Our advanced processing node portfolio and our investment in hybrid bonding have established us as a recognized pioneer in enabling technologies that will drive tomorrow's AI. Before I turn the call over to Keith to further discuss our financials, I would like to briefly provide an update on our measures of success. I am very pleased with the progress we have made to date in each of these key areas. Future revenue growth will be primarily driven by opportunities in OTT, such as our recent deal with DAZN, in addition to adjacent market opportunities such as ad tech, automotive, e-commerce, gaming, music streaming, and sports gambling. Importantly, these adjacent markets are entirely greenfield opportunities, and we believe they can be significant revenue contributors in the future. We continue to make progress in OTT in our adjacent markets and customer engagements are at various stages. We also remain very excited about our hybrid bonding and advanced processing node portfolios applicability in the logic market for our semiconductor business. As we see these technologies being a catalyst for leading edge logic devices. Our pipeline of deals remains diverse and robust, and we believe our deal momentum will continue for the rest of the year. Lastly, as noted earlier, we remain on track to grow our patent portfolios 10% this year. With that, let me turn the call over to Keith to cover our second quarter financial results and our guidance for 2023.