Snap, crackle, pop!
That's the soundtrack to InterDigital's
Wireless patents are hot, hot, hot right now after a treasure trove of Nortel patents sold for a whopping $4.5 billion. The ragtag yet ritzy consortium of buyers includes unlikely allies Apple
Given the buyout electricity crackling around InterDigital, you'd think that an earnings report might not make much of a difference to the stock -- and you'd be right.
Second-quarter revenue fell 23% year-over-year to $70 million, mainly due to a one-time back payment from LG Electronics in the year-ago period. Earnings dropped about 50% to $0.37 per share. None of that mattered, and share prices shot up 6% in early trading only to settle down at a small one-day loss later on.
Google is clearly hungry for defensive patents, having just bought a basket of more than 1,000 technology patents from IBM
It's a strategy of mutually assured destruction. "Sue us and we'll sue you right back," followed by back-and-forth negotiations and perhaps a settlement. Woe betide those who come to this gunfight equipped with anything less than a howitzer.
Will InterDigital become Google's little friend? Investors seem to think so, and it does make a ton of sense. To follow the company into perhaps its last days as a stand-alone business, just click here to add InterDigital to your watchlist. It's a great way to stay on top of news and analysis of any stock you'd care to investigate.
Fool contributor Anders Bylund owns shares of Google, but he holds no other position in any company mentioned. The Motley Fool owns shares of Research In Motion, Apple, Microsoft, IBM, Google, and EMC. Motley Fool newsletter services have recommended buying shares of Apple, InterDigital, Google, and Microsoft. Motley Fool newsletter services have recommended creating a covered collar position in Microsoft, as well as a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio, follow him on Twitter or Google+, or peruse our Foolish disclosure policy.