Rambus Reports Second Quarter 2024 Financial Results

SAN JOSE, Calif. – July 29, 2024 – Rambus Inc. (NASDAQ:RMBS), a provider of industry-leading chips and IP making data faster and safer, today reported financial results for the second quarter ended June 30, 2024. GAAP revenue for the second quarter was $132.1 million, licensing billings were $61.5 million, product revenue was $56.7 million, and contract and other revenue was $19.0 million. The Company also generated $70.4 million in cash provided by operating activities in the second quarter.

“We delivered solid second quarter results with robust growth in product revenue and excellent cash from operations,” said Luc Seraphin, chief executive officer of Rambus. “Through continued execution and ongoing investment in our industry-leading product roadmap for data center and AI, we expect a strong third quarter driven again by double-digit sequential chip growth.”

Quarterly Financial Review – GAAP	Three Months Ended June 30,
(In millions, except for percentages and per share amounts)	2024	2023
Revenue
Product revenue	$ 56.7	$ 55.0
Royalties	56.4	40.7
Contract and other revenue	19.0	24.1
Total revenue	132.1	119.8
Cost of product revenue	22.8	18.7
Cost of contract and other revenue	1.0	1.3
Amortization of acquired intangible assets (included in total cost of revenue)	3.0	3.6
Total operating expenses ⁽¹⁾	65.0	84.5
Operating income	$ 40.3	$ 11.7
Operating margin	31 %	10 %
Net income	$ 36.1	$ 168.9
Diluted net income per share	$ 0.33	$ 1.51
Net cash provided by operating activities	$ 70.4	$ 50.4

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⁽¹⁾ Includes amortization of acquired intangible assets of approximately $0.2 million and $0.4 million for the three months ended June 30, 2024 and 2023, respectively.

Quarterly Financial Review – Supplemental Information⁽¹⁾	Three Months Ended June 30,
(In millions)	2024	2023
Licensing billings (operational metric) ⁽²⁾	$ 61.5	$ 60.2
Product revenue (GAAP)	$ 56.7	$ 55.0
Contract and other revenue (GAAP)	$ 19.0	$ 24.1
Non-GAAP cost of product revenue	$ 22.7	$ 18.6
Cost of contract and other revenue (GAAP)	$ 1.0	$ 1.3
Non-GAAP total operating expenses	$ 53.4	$ 55.9
Non-GAAP interest and other income (expense), net	$ 3.9	$ 1.2
Diluted share count (GAAP)	109	112

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⁽¹⁾ See “Supplemental Reconciliation of GAAP to Non-GAAP Results” table included below.

⁽²⁾ Licensing billings is an operational metric that reflects amounts invoiced to our licensing customers during the period, as adjusted for certain differences relating to advanced payments for variable licensing agreements.

GAAP revenue for the quarter was $132.1 million. The Company also had licensing billings of $61.5 million, product revenue of $56.7 million, and contract and other revenue of $19.0 million. The Company had total GAAP cost of revenue of $26.8 million and operating expenses of $65.0 million. The Company also had total non-GAAP operating expenses of $77.1 million (including non-GAAP cost of revenue of $23.7 million). The Company had GAAP diluted net income per share of $0.33. The Company’s basic share count was 108 million shares and its diluted share count was 109 million shares.

Cash, cash equivalents, and marketable securities as of June 30, 2024 were $432.9 million, an increase of $41.8 million from March 31, 2024, mainly due to $70.4 million in cash provided by operating activities, offset by $12.5 million paid in connection with a share repurchase program and $11.3 million paid to acquire property, plant and equipment.

2024 Third Quarter Outlook

The Company will discuss its full revenue guidance for the third quarter of 2024 during its upcoming conference call. The following table sets forth the third quarter outlook for other measures.

(In millions)	GAAP	Non-GAAP ⁽¹⁾
Licensing billings (operational metric) ⁽²⁾	$60 – $66	$60 – $66
Product revenue (GAAP)	$62 – $68	$62 – $68
Contract and other revenue (GAAP)	$17 – $23	$17 – $23
Total operating costs and expenses	$97 – $93	$82 – $78
Interest and other income (expense), net	$4	$4
Diluted share count	109	109

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⁽¹⁾ See “Reconciliation of GAAP Forward-Looking Estimates to Non-GAAP Forward-Looking Estimates” table included below.

For the third quarter of 2024, the Company expects licensing billings to be between $60 million and $66 million. The Company also expects royalty revenue to be between $59 million and $65 million, product revenue to be between $62 million and $68 million, and contract and other revenue to be between $17 million and $23 million. Revenue is not without risk and achieving revenue in this range will require that the Company sign customer agreements for various product sales and solutions licensing, among other matters.

The Company also expects operating costs and expenses to be between $97 million and $93 million. Additionally, the Company expects non-GAAP operating costs and expenses to be between $82 million and $78 million. These expectations also assume a tax rate of 22% and a diluted share count of 109 million, and exclude stock-based compensation expense of $12 million and amortization of acquired intangible assets of $3 million.

Conference Call

The Company’s management will discuss the results of the quarter during a conference call scheduled for 2:00 p.m. PT today. The call, audio and slides will be available online at investor.rambus.com and a replay will be available for the next week at the following numbers: (866) 813-9403 (domestic) or (+1) 929-458-6194 (international) with ID# 295037.

Financial tables

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