DALLAS, TX -- July 20, 2026 -- Xperi Inc. (NYSE: XPER): Stonegate Capital Partners Initiates Coverage on Xperi Inc. (NYSE: XPER). Xperi’s 1Q26 results increased confidence that its earnings inflection is underway. Topline benefited from earlier contract signings in Consumer Electronics and Connected Car, but the more meaningful change was the cost base as adjusted operating expense fell 14%, lifting adjusted EBITDA margin to 22.1% from 14.4%. Management said first-quarter expenses are a fair run rate, giving the Company room to translate Media Platform growth into earnings without relying on further large cost actions. TiVo One’s expanding audience is beginning to support advertising revenue, reinforcing the shift toward post-deployment monetization. We are keeping our eye on TiVo One ARPU, the second-half advertising ramp, and the first AutoStage data licenses as markers of continued progress.
Quarterly Results: Revenue beat consensus by +6%, and nearly flat year-over year. Adjusted EBITDA rose to $25.3M from $16.4M, and non-GAAP EPS increased to $0.23 from $0.16. The quarter benefited from earlier CE and Connected Car agreements, while the margin improvement reflected a reduction in the cost structure. Workforce actions lowered adjusted operating expense by 14%, and management indicated that most of the cost work is complete. While the 22.1% margin was above the full-year range, the quarter supports confidence in the 17% to 19% outlook and shows how incremental platform revenue can contribute to earnings.
Media Platform: Media Platform revenue increased 45% to $11.7M, led by advertising across direct sales, partner channels, and linear-TV campaigns. TiVo One monthly active users reached 5.5M, up from 5.3M at year-end and more than double last year. ARPU declined to $7.10 from $7.80 in 4Q25 because users grew faster than monetization, though management continues to target more than 7M users and year-end ARPU above $10. The Company maintained its goal for Media Platform revenue to exceed $80M in 2026. Samba TV and other integrations expand measurement, targeting, and programmatic access, supporting higher monetization.
Connected Car/Pay TV: Connected Car revenue rose 14% to $38.1M, mainly from a multiyear minimum guarantee signed during the quarter. AutoStage reached more than 16M vehicles across 13 brands, and management expects its first broadcaster data licenses in 2Q26, followed by advertising trials in the U.S. and Europe later this year. Pay-TV revenue declined 8% to $46.0M as lower legacy-guide revenue outweighed IPTV growth. IPTV households increased 19% to 3.28M, while new ad-insertion and digital-rights-management products create opportunities to raise ARPU. Consumer Electronics revenue fell 19% to $18.4M against prior-year minimum guarantees, audit settlements, and memory pressure.
Outlook: Management maintained 2026 guidance for revenue of $440M to $470M, adjusted EBITDA margin of 17% to 19%, operating cash flow of $15M to $25M, and capital expenditures of $15M to $20M. Earlier signings shifted revenue from a back-half weighting to an even split. Xperi ended March with $70.4M of cash and $40M of debt, then received the final $12M Perceive payment in April. The balance sheet supports Media Platform and AutoStage investment while preserving flexibility for debt repayment and repurchases.
Valuation: We use a DCF Model and EV/EBITDA comp analysis to guide our valuation. Our DCF analysis produces a valuation range of $10.44 to $12.79 with a mid-point of $11.45. Our EV/EBITDA valuation results in a range of $12.12 to $13.08 with a mid-point of $12.60. For more information please see the valuation page of this report.
