In This Article:
-
Revenue: $145.5 million for Q3.
-
Royalty Revenue: $64.1 million.
-
Licensing Billings: $65.4 million.
-
Product Revenue: $66.4 million, up 17% sequentially and 27% year over year.
-
Contract and Other Revenue: $15 million.
-
Operating Costs: $80.5 million, including cost of goods sold.
-
Operating Expenses: $55.3 million.
-
Non-GAAP Net Income: $54.1 million.
-
Cash, Cash Equivalents, and Marketable Securities: $432.7 million.
-
Cash from Operations: $62.1 million.
-
Stock Repurchases: $50 million, retiring approximately 1.2 million shares.
-
Capital Expenditures: $13.5 million.
-
Free Cash Flow: $48.6 million.
-
Q4 Revenue Guidance: Between $154 million and $160 million.
-
Q4 Non-GAAP Earnings Per Share Guidance: Between $0.52 and $0.59.
Release Date: October 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Rambus Inc (NASDAQ:RMBS) reported strong sequential growth in Q3, with a double-digit increase in product revenue driven by DDR5 memory interface chips.
-
The company generated $62 million in cash from operations and repurchased $50 million of stock, marking the fifth consecutive quarter of share repurchases.
-
Rambus Inc (NASDAQ:RMBS) introduced industry-first chipsets for DDR5 MRDIMMs and RDIMMs, expanding their addressable market and long-term growth opportunities.
-
The company anticipates a third consecutive quarter of double-digit sequential growth in Q4, with a projected greater than 30% product growth in the second half compared to the first half of the year.
-
Rambus Inc (NASDAQ:RMBS) continues to leverage its strong balance sheet to support strategic investments in new products, enhancing its market opportunity and driving long-term growth.
Negative Points
-
Silicon IP revenue showed a shift in classification, with more off-the-shelf IP sales resulting in lower contract and other revenue.
-
The DDR4 market remains small, with modest sales and a long tail of inventory depletion.
-
The CXL market is fragmented, with Rambus Inc (NASDAQ:RMBS) expecting consolidation at the CXL 3.0 node, potentially delaying significant product volumes.
-
The company faces challenges in maintaining product gross margins, with fluctuations depending on the product mix shipped each quarter.
-
Rambus Inc (NASDAQ:RMBS) is investing heavily in JEDEC standard products, which require significant ecosystem traction to justify the investments.
Q & A Highlights
Q: Can you clarify the discrepancy in contract revenue guidance versus actual results, and explain the moving parts? A: Desmond Lynch, SVP & CFO, explained that silicon IP revenue can appear under both contract and licensing billings. The shift in revenue classification was due to more off-the-shelf IP sales, resulting in higher licensing billings and lower contract revenue. Overall, silicon IP revenue was flat quarter-over-quarter, and the business is on track to meet annual growth targets.