UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________________ FORM 10-Q _______________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 000-22339 _______________________________ RAMBUS INC. (Exact na ...

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Core Viewpoint - Rambus is experiencing significant growth due to surging DRAM demand driven by artificial intelligence (AI) and recovering traditional server markets, leading to a positive outlook for the company [1][4]. Group 1: Financial Performance - Rambus reported a revenue increase of 38.2% to $145.5 million, with earnings per share (EPS) of $0.45, despite a year-over-year decline in EPS due to a prior year's divestiture gain [4]. - Management forecasts approximately $160 million in Q4 revenue, indicating a sequential growth of about 10% [5]. - The company holds $433 million in cash with no debt, representing about 8% of its market cap, and has engaged in stock repurchases amounting to $50 million in the last quarter [6]. Group 2: Market Position and Growth Potential - Rambus generates revenue through memory interface chips, royalty revenue from licensing patents, and contract services, making it well-positioned to benefit from the AI revolution [2][6]. - The company is first to market with advanced DDR5 MRDIMM 12800 and RDIMM 8000 modules, which could significantly expand its addressable market [5]. - Despite being less prominent than larger chip companies, Rambus is seen as a potential major beneficiary of the AI trend, with shares trading at about 25 times current run-rate EPS [6][7].

Financial Data and Key Metrics - Q3 revenue was $145.5 million, with product revenue at $66.4 million, up 17% sequentially and 27% YoY [24][25] - Royalty revenue was $64.1 million, while licensing billings were $65.4 million [24] - Non-GAAP net income for Q3 was $54.1 million, with a 22% assumed tax rate [26] - Cash from operations was $62.1 million, and free cash flow was $48.6 million [27] - Q4 revenue guidance is between $154 million and $160 million, with non-GAAP operating profit expected between $68 million and $78 million [29][30] Business Line Performance - Memory interface chips delivered $66 million in revenue, up 17% sequentially and 27% YoY, driven by DDR5 products [10] - Silicon IP revenue was relatively flat at $28 million to $29 million, with a shift toward off-the-shelf IP sales [33] - DDR5 RCD products gained market share, with early contributions from new products [10] - DDR4 sales remained modest at around $5 million per quarter [40] Market Performance - Data center demand growth in H2 2024 drove increased sales of DDR5 RCD products [10] - The server market is expected to grow mid-single digits in 2024, with Rambus gaining share [63] - DDR5 inventory levels are reasonable, while DDR4 inventory depletion continues [64] Strategy and Industry Competition - The company introduced industry-first DDR5 MRDIMM 12800 and RDIMM 8000 chipsets, expanding its addressable market [9][12] - Rambus is strategically focused on advancing system memory bandwidth and capacity through innovative memory, connectivity, and power management solutions [19] - The company aims to achieve similar market share in MRDIMM as it has in RCD, with MRDIMM expected to contribute significantly to SAM expansion [59][61] Management Commentary on Operating Environment and Future Outlook - Management expects double-digit product revenue growth in Q4 and over 30% growth in H2 compared to H1 [20] - The company is well-positioned to capitalize on secular trends in data center and AI, driven by DDR5 leadership and new product introductions [21] - AI and data-intensive workloads are accelerating the cadence of new product development [11] Other Important Information - The company repurchased $50 million of stock in Q3, marking the fifth consecutive quarter of share buybacks [8] - Q3 capital expenditures were $13.5 million, with depreciation expense of $6.7 million [27] - Q4 capital expenditures are expected to be approximately $11 million [29] Q&A Session Summary Kevin Cassidy (Rosenblatt Securities) - Asked about the shift in silicon IP revenue classification and received clarification on off-the-shelf vs. customized IP [33] - Inquired about HBM4 Controller IP payment timing, with Luc Seraphin confirming payment upon IP delivery [35] - Followed up on MRDIMM market share expectations, with Luc explaining its use cases and market potential [65] Blayne Curtis (Jefferies) - Asked about silicon IP growth and lumpiness in contract revenue, with Des confirming 10% growth expectations [38][39] - Inquired about DDR4 recovery, with Luc stating DDR4 sales remain modest, while DDR5 drives growth [40] Mehdi Hosseini (SIG) - Asked about the drivers of product revenue growth, with Luc attributing it to DDR5 market share gains and initial companionship sales [43][44] - Inquired about product gross margin trends, with Des confirming a long-term target of 60%-65% [47][48] - Followed up on HBM4 content and operating leverage, with Luc explaining HBM4 speed improvements and Des outlining R&D and SG&A expectations [67][69][70] Nam Kim (Arete Research) - Asked about CXL controller chip development and market sentiment, with Luc discussing fragmentation and future consolidation at CXL 3.0 [51][52] - Inquired about MRDIMM vs. MCR DIMM, with Luc emphasizing Rambus's focus on JEDEC standards [72][74][75] Gary Mobley (Loop Capital) - Asked about MRDIMM market evolution and Rambus's market share expectations, with Luc detailing the company's strategy and content per module [57][59][61] - Inquired about the impact of server market recovery on product revenue, with Luc confirming share gains and reasonable DDR5 inventory levels [62][63]

Rambus (RMBS) came out with quarterly earnings of $0.50 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.43 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this memory chip designer would post earnings of $0.42 per share when it actually produced earnings of $0.46, delivering a surprise of 9.52%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Rambus, which belongs t ...

Core Viewpoint - Rambus Inc. is positioned to benefit from the growing demand for high-bandwidth memory (HBM) driven by artificial intelligence (AI) applications, although its current revenue growth has not yet reflected this potential [1][3][4]. Company Overview - Rambus Inc. is a chip designer that licenses its technology and architecture to semiconductor companies, similar to Arm Holdings [1]. - The company offers DDR4 and DDR5 memory interface modules, with DDR5 providing improved efficiency and lower power consumption compared to DDR4 [1]. - Rambus has a significant patent portfolio with over 2,700 patents and applications [1]. Financial Performance - For Q2 2024, Rambus reported an EPS of 33 cents and revenues of $132.10 million, which was below consensus estimates of $139 million [4]. - Product revenue increased by 13% sequentially but only grew 3% year-over-year, while royalty revenue surged 38% year-over-year to $56.4 million [4]. - The company ended the quarter with $432.9 million in cash and cash equivalents [4]. Future Outlook - Rambus expects license billings for Q3 2024 to be between $60 million and $66 million, indicating potential double-digit growth [5]. - The consensus estimates for Q3 2024 are an EPS of 52 cents and revenue of $147.67 million [5]. - Rambus announced the industry's first HBM4 Memory Controller IP to support next-gen AI workloads, which could enhance its revenue from licensing and royalties [6]. Market Position - Rambus's stock has a 12-month price forecast of $77.75, representing an 86.94% upside potential, with a high forecast of $85.00 [4][7]. - The stock trades at a forward P/E ratio of 29.2x, and four analysts have given it Buy ratings [7]. Client Relationships - Notable clients in the technology sector include NVIDIA, AMD, and Micron Technology, which are also leveraging Rambus's intellectual property [2][3].

October 2024 Monthly Dividend of $0.12 Per Share of Common Stock Estimated Book Value Per Share as of September 30, 2024 of $8.40 Estimated GAAP net income of $0.24 per share for the quarter ended September 30, 2024, including an estimated $0.29 per share of net realized and unrealized gains on RMBS and derivative instruments Estimated 2.1% total return on equity for the quarter ended September 30, 2024 Estimated book value, net income and total return on equity amounts are preliminary, subject to change, a ...

Rambus (RMBS) shares have plunged 27.4% over the past three months, underperforming the Zacks Electronics - Semiconductors industry's return of 8.4%. RMBS stock also underperformed the Zacks Computer and Technology sector and the S&P 500. The underperformance can mainly be attributed to its lower-than-expected top-line results for the third quarter of 2024. Rambus is facing a slowdown in revenue growth due to the broader enterprise market shifting its focus toward artificial intelligence (AI) and machine le ...

Rambus (RMBS) shares have plunged 32.2% over the past three months, underperforming the Zacks Electronics - Semiconductors industry's return of 2.6%. RMBS stock also underperformed the Zacks Computer and Technology sector and the S&P 500. Given this underperformance, investors are wondering whether this drop reflects underlying weaknesses, or is it a temporary pullback that offers a buying opportunity. Reason Behind RMBS Stock's Underperformance Rambus stock's underperformance was mainly due to its lower-th ...

Rambus (RMBS) shares rallied 10.8% in the last trading session to close at $42.47. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 12.7% loss over the past four weeks. The optimism surrounding the stock can be attributed to the rising adoption of Ramus' products. The company is rapidly expanding its portfolio with innovative product launches which helps in attracting more customers. Recently, it launched the ...