Rambus(RMBS) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Financial Results Q2 2025 Performance Highlights Rambus reported a strong second quarter for 2025, exceeding revenue and earnings expectations with record product revenue and cash from operations - CEO Luc Seraphin highlighted the chip business as a key growth engine, driven by leadership in DDR5 memory interface chips and growing demand from high-performance computing and AI infrastructure[2] - The company exceeded expectations for Q2 revenue and earnings[3] Q2 2025 Key Performance Metrics | Metric | Value | Change (YoY) | | :--- | :--- | :--- | | Product Revenue | $81.3 million | +43% | | Cash from Operations | $94.4 million | Record high | Q2 2025 Financial Review (GAAP) Rambus reported significant increases in GAAP total revenue, operating income, and net income for Q2 2025 compared to the prior year Q2 2025 vs Q2 2024 GAAP Financials (in millions, except per share) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue | $172.2 | $132.1 | | Product Revenue | $81.3 | $56.7 | | Royalties | $68.6 | $56.4 | | Contract and other revenue | $22.3 | $19.0 | | Operating Income | $63.0 | $40.3 | | Operating Margin | 37% | 31% | | Net Income | $57.9 | $36.1 | | Diluted Net Income per Share | $0.53 | $0.33 | | Net cash provided by operating activities | $94.4 | $70.4 | Balance Sheet and Cash Flow Summary As of June 30, 2025, Rambus's cash, cash equivalents, and marketable securities increased to $594.8 million, primarily driven by strong cash generation from operations - Cash, cash equivalents, and marketable securities increased by $80.4 million during Q2 2025 to a total of $594.8 million[5] - The increase in cash was mainly due to $94.4 million generated from operating activities, partially offset by $10.4 million used for capital expenditures[5] 2025 Third Quarter Outlook Q3 2025 Financial Guidance Rambus projects Q3 2025 licensing billings between $58 million and $64 million, with product revenue expected to range from $87 million to $93 million Q3 2025 Outlook (in millions) | Metric | Low | High | | :--- | :--- | :--- | | Licensing billings | $58 | $64 | | Product revenue (GAAP) | $87 | $93 | | Contract and other revenue (GAAP) | $22 | $28 | | Total operating costs and expenses (GAAP) | $111 | $115 | | Total operating costs and expenses (Non-GAAP) | $94 | $98 | - The Q3 outlook assumes a tax rate of 20% and a diluted share count of 108.5 million[8] - The guidance excludes estimated stock-based compensation of $15 million and amortization of acquired intangible assets of $2 million[8] Detailed Financial Statements Condensed Consolidated Balance Sheets As of June 30, 2025, Rambus reported total assets of $1.468 billion, an increase from year-end 2024, with total stockholders' equity reaching $1.228 billion Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $783,757 | $690,257 | | Total assets | $1,467,811 | $1,343,136 | | Total current liabilities | $72,228 | $81,812 | | Total long-term liabilities | $167,603 | $140,632 | | Total stockholders' equity | $1,227,980 | $1,120,692 | Condensed Consolidated Statements of Income For the three months ended June 30, 2025, Rambus reported total revenue of $172.2 million, resulting in an operating income of $63.0 million and net income of $57.9 million Income Statement Summary - Three Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total revenue | $172,209 | $132,138 | | Gross profit | $137,439 | $105,307 | | Operating income | $62,993 | $40,322 | | Net income | $57,935 | $36,056 | Income Statement Summary - Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total revenue | $338,873 | $250,009 | | Gross profit | $271,261 | $199,519 | | Operating income | $126,137 | $70,453 | | Net income | $118,238 | $68,954 | Non-GAAP Financial Measures & Reconciliations Explanation of Non-GAAP Measures Rambus utilizes non-GAAP financial measures to provide comparable performance insights by excluding specific items such as stock-based compensation and acquisition-related costs - The company presents non-GAAP measures to provide investors with a view of performance comparable to other periods, excluding certain items[10] - Key items excluded from GAAP results to arrive at non-GAAP measures include: - Stock-based compensation expense - Acquisition-related costs and retention bonuses - Amortization of acquired intangible assets - Impairment of assets - Change in fair value of earn-out liability[11][12][13] - For non-GAAP tax calculations, the company uses a fixed, long-term projected tax rate, which is approximately 20% for 2025[15] Reconciliation of GAAP to Non-GAAP Results Q2 2025 GAAP total operating expenses of $74.4 million were reconciled to non-GAAP total operating expenses of $60.4 million, primarily by excluding stock-based compensation Q2 2025 GAAP to Non-GAAP Reconciliation (in thousands) | Metric | GAAP | Adjustments | Non-GAAP | | :--- | :--- | :--- | :--- | | Cost of product revenue | $32,418 | $(227) | $32,191 | | Total operating expenses | $74,446 | $(14,090) | $60,356 | Reconciliation of Forward-Looking Estimates The Q3 2025 outlook reconciles forward-looking GAAP operating costs and expenses to a non-GAAP range by adjusting for stock-based compensation and amortization of intangible assets Q3 2025 Outlook Reconciliation (in millions) | Metric | Low | High | | :--- | :--- | :--- | | Forward-looking GAAP operating costs and expenses | $115 | $111 | | Stock-based compensation expense adjustment | (15) | (15) | | Amortization of acquired intangible assets adjustment | (2) | (2) | | Forward-looking Non-GAAP operating costs and expenses | $98 | $94 | Company Information and Disclosures About Rambus Inc. Rambus is a global semiconductor company specializing in innovative memory and security solutions for data center and AI markets, offering chips and silicon IP - Rambus is a semiconductor company focused on memory and security solutions for the data center and AI industries[17] - The company's portfolio includes chips and silicon IP designed to enhance performance and security in computationally intensive systems[17] Forward-Looking Statements This report includes forward-looking statements concerning business outlook and financial guidance, which are subject to inherent risks and uncertainties - The release includes forward-looking statements concerning business outlook, growth, and financial guidance for Q3 2025[18] - These statements are subject to risks and uncertainties, and actual results may differ materially. Readers are referred to SEC filings for a full description of risks[18]