Executive Summary

Q4 2024 (company’s Q3 FY2025, quarter ended Jan 31, 2025) revenue was $474.8M with GAAP diluted EPS of $0.47; non-GAAP diluted EPS was $0.63, reflecting BNED consolidation and continued licensing profitability .
Mix shifted within the Immersion segment: fixed-fee licensing grew (auto wins), while per‑unit royalties softened vs the prior comparable period; consolidated operating income was $26.2M with a 47.3% effective tax rate .
Capital returns continued: Immersion declared its tenth $0.045 quarterly dividend (payable Apr 25, 2025) and extended its $50M repurchase program to Dec 29, 2026 with $40.6M remaining authorization .
Management emphasized execution and capital allocation (“returned over $9 million to shareholders in the form of dividends and buybacks”)—ongoing BNED integration/seasonality and legal matters (Valve IP case, LGE tax) are key watch items for estimate revisions and sentiment .

What Went Well and What Went Wrong

What Went Well
- Strong consolidated results on BNED contribution: total revenue $474.8M; operating income $26.2M; non-GAAP net income $20.8M .
- Licensing resilience via fixed-fee growth: Immersion fixed-fee license revenue +$4.6M vs the prior comparable period, “primarily due to a $3.0M increase in automotive license revenue” .
- Ongoing capital returns: over $9M returned via dividends and buybacks; declared tenth quarterly $0.045 dividend; repurchase program extended through 2026 with $40.6M capacity .
What Went Wrong
- Per‑unit royalty softness: Immersion per‑unit royalties fell $5.6M (‑68%) vs the prior comparable quarter; segment operating income declined to $3.4M .
- Elevated tax rate: consolidated effective tax rate of 47.3% weighed on net income leverage .
- Balance-sheet/working-capital intensity at BNED: ABL borrowings of $141.2M and significant seasonal working capital accompany the BNED business model and seasonality .

Financial Results

Note on period naming: “Q4 2024” corresponds to Immersion’s Q3 FY2025 (quarter ended Jan 31, 2025) following the fiscal-year change to April 30 year-end .

Metric	Prior Year (3M ended Sep 30, 2023)	Q2 FY2025 (3M ended Oct 31, 2024)	Q3 FY2025 / Q4 2024 (3M ended Jan 31, 2025)
Total Revenue ($M)	$9.5	$616.2	$474.8
Operating Income ($M)	$6.5	$64.4	$26.2
Net Income attributable to Immersion ($M)	$2.7	$27.2	$15.5
Diluted EPS ($)	$0.08	$0.83	$0.47
Non‑GAAP Net Income ($M)	$3.7	$40.2	$20.8
Non‑GAAP Operating Expenses ($M)	$2.0	$73.2	$74.2

Segment breakdown (current quarter)

Segment	Revenue ($M)	Operating Income ($M)
Immersion	$8.4	$3.4
Barnes & Noble Education (BNED)	$466.3	$22.8
Total	$474.8	$26.2

KPIs

KPI	Prior Comparable Period (3M ended Sep 30, 2023)	Q3 FY2025 / Q4 2024 (3M ended Jan 31, 2025)
Immersion Fixed‑Fee License Revenue ($M)	$1.2	$5.8
Immersion Per‑Unit Royalty Revenue ($M)	$8.3	$2.7
BNED Product & Other Revenue ($M)	—	$423.2
BNED Course Material Rental Income ($M)	—	$43.2
Effective Tax Rate (%)	32.4%	47.3%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Action	Change
Quarterly Dividend	Next payable Apr 25, 2025	$0.045/share	$0.045/share declared; record Apr 14, 2025	Maintained
Share Repurchase Program	Authorization through Dec 29, 2026	Expires Dec 29, 2025	Extended to Dec 29, 2026; $40.6M remaining authorization	Extended
Revenue/EPS/OpEx Guidance	Q4 2024	None disclosed	None disclosed in press release/8‑K/10‑Q	N/A
Special Dividend	Paid Jan 24, 2025	N/A	$0.245/share special dividend declared Nov 8, 2024 (paid Jan 24, 2025)	One‑time action

Earnings Call Themes & Trends

Note: No Q4 2024 earnings call transcript was available in our corpus for IMMR; themes are drawn from company press releases and the 10‑Q.

Topic	Prior Two Quarters (Q2 FY2025 and Q2 2024)	Current Period (Q3 FY2025 / Q4 2024)	Trend
Capital returns (dividends/buybacks)	Q2 FY2025: special dividend $0.245 declared; ongoing $0.045 quarterly . Q2 2024: dividend cadence reiterated .	Tenth $0.045 quarterly declared; >$9M returned in quarter; buyback program extended, $40.6M remaining .	Sustained/expanded.
BNED integration and seasonality	BNED consolidated from June 10; strong seasonal revenue in back‑to‑school; consolidated revenue $616.2M ; seasonality explained .	BNED drove $466.3M revenue; seasonality and working capital cycle reiterated .	Integration ongoing; seasonality intact.
Licensing mix (fixed‑fee vs per‑unit)	Elevated Immersion licensing revenue in prior quarters; fixed‑fee meaningful post new contracts .	Fixed‑fee up $4.6M vs prior comparable, driven by auto; per‑unit royalties down $5.6M .	Mix shifting toward fixed‑fee.
Legal/regulatory	—	Updates: Valve IPRs and litigation schedule; Korea LGE withholding tax appeals ongoing .	Active docket; outcomes pending.
Geographic/End‑market mix	—	Immersion revenue by geography for quarter and narrative on mobility/auto/gaming mix; geographic shares discussed in MD&A .	Asia‑heavy annual mix; quarterly lumpy.

Management Commentary

“Immersion drove strong financial performance in the quarter. Underscoring our financial strength, we returned over $9 million to shareholders in the form of dividends and buybacks. We continue to be laser focused on building our business and creating long‑term shareholder value.” — Eric Singer, Chairman & CEO .
Immersion segment dynamics: “Fixed fee license revenue increased by $4.6 million… primarily due to a $3.0 million increase in automotive license revenue… Per‑unit royalty revenue decreased by $5.6 million… primarily due to a $3.8 million decrease in royalties from mobility licensees” .
BNED seasonality: major portion of sales/profit in second and third fiscal quarters; shifts in timing of cash collection under First Day programs highlighted .
Working capital and contract assets: contract assets rose by $28.8M driven by unbilled revenue from new contracts .

Q&A Highlights

No earnings call transcript for the Q4 2024 period was available in our document set; therefore, Q&A themes and any clarifications provided on the call could not be assessed.

Estimates Context

Wall Street consensus estimates (S&P Global) for revenue and EPS for the quarter ended Jan 31, 2025 were not retrievable at the time of analysis due to data access limits. As a result, we cannot quantify beats/misses vs consensus for Q4 2024. If needed, we can refresh and add this comparison upon access restoration.

Key Takeaways for Investors

Consolidation uplift from BNED is material to reported revenue and operating income; the seasonal cadence and ABL usage should frame expectations for cash flow volatility and leverage over the next quarters .
Within Immersion’s core licensing model, fixed‑fee momentum (notably auto) offset per‑unit royalty softness; near‑term estimate revisions may focus on mix and sustainability of fixed‑fee pipelines .
Elevated effective tax rate (47.3%) reduced flow‑through; modeling should reflect potential variability in tax outcomes given legal/tax matters (LGE) .
Capital allocation remains a support: sustained dividend ($0.045) and extended buyback program with $40.6M capacity provide downside cushion and potential EPS accretion .
Legal docket (Valve/PTAB IPRs) and BNED performance vs covenants (ABL facility, EBITDA tests) are catalysts for sentiment and risk assessment through FY2025 .
Absent explicit revenue/EPS guidance, focus on licensing deal cadence, BNED First Day program scaling, and operating expense control to gauge trajectory into Q4 FY2025 (quarter ending Apr 30, 2025) .

IMMERSION CORP (IMMR)·Q4 2024 Earnings Summary