- **Revenue Growth**: Q3 revenue of $59.4M (+16% QoQ, +155% YoY) driven by Deflecto acquisition.
- **Profitability**: Adjusted EBITDA of $8M, free cash flow $7.7M, despite GAAP loss of $0.03/share.
- **Segment Strength**: Energy ($14.2M), Manufacturing ($30.8M), and Industrial ($6.7M) all expanded.
- **IP Success**: Licensing revenue up 408% YoY to $78M, with $44.2M EBITDA year-to-date.
- **Debt Reduction**: Total debt down $37.4M since Q2 2024, cash position $332.4M.
- **Strategic Focus**: Low-leverage M&A (1.5-2x turns), disciplined cost control, and IR outreach expansion.


**【CEO Summary Section】**
- Total revenue reached $59.4 million, up 16% sequentially and 155% year-over-year, driven by the Deflecto acquisition.
- Adjusted EBITDA was $8 million, with free cash flow of $7.7 million for the quarter.
- Key segments performed strongly: Energy ($14.2M revenue), Manufacturing ($30.8M), and Industrial ($6.7M).
- IP segment generated $7.4M in licensing revenue, up significantly from prior years.
- Management emphasized disciplined cost control, pricing strategies, and M&A pipeline acceleration.

**【CFO Financial Commentary】**
- GAAP net loss was $2.7M ($0.03 per share), improved from $14M loss in prior year, due to higher revenue and reduced legacy legal costs.
- Energy segment contributed $1.1M in GAAP operating income, with $6.1M adjusted EBITDA.
- Manufacturing segment generated $1.1M GAAP operating income, with $2.6M adjusted EBITDA.
- Industrial segment had $0.3M GAAP operating income, with $0.8M adjusted EBITDA.
- Total cash and securities reached $332.4M, down $37.4M in debt since Q2 2024.

**【Q&A Highlights】**
- **Deflecto Free Cash Flow**: CEO expects low-to-mid-teens EBITDA margins as macro normalizes, with $13M debt paid down since acquisition.
- **IP Portfolio**: $78M year-to-date revenue (vs. $19.4M prior year), driven by licensing deals.
- **M&A Strategy**: Focus on low-leverage deals with 1.5-2x turns, avoiding high debt multiples.
- **IR Outreach**: Increased investor engagement via conferences, with plans for sell-side analyst coverage.
- **Biotech Update**: AMO Pharma's myotonic dystrophy drug in Phase III, cautiously optimistic on approval timeline.
- **TPLink Litigation**: Federal Circuit oral arguments pending, judgment collection process ongoing.


Acacia Research Corporation (ACTG) Q3 2025 Earnings Call Transcript

Paid-up Revenue Agreements

Recurring Revenue Agreements

Intellectual Property Operations

Industrial Operations

Energy Operations

Manufacturing Operations

Americas

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Asia-Pacific

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