EX-99.1 CHARTER 2 ex99-1.htm EX-99.1 ex99-1.htm

Exhibit 99.1
 
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 NEWS RELEASE
 

 
RAMBUS REPORTS THIRD QUARTER EARNINGS
 
Revenue of $27.9 million, loss per share of $0.26 cents for the third quarter
 
LOS ALTOS, Calif. – October 22, 2009 – Rambus Inc. (NASDAQ:RMBS), one of the world’s premier technology licensing companies specializing in high-speed memory architectures, today reported financial results for the third quarter of 2009.
 
Revenue for the third quarter of 2009 was $27.9 million, up 3.3% sequentially from the second quarter of 2009 primarily due to higher variable royalty revenue.  As compared to the third quarter of 2008, revenue was down 5.3% primarily due to lower contract revenue. Revenue for the nine months ended September 30, 2009 was $82.2 million, down 21.6% over the same period of last year primarily due to revenue recognized from Elpida during the first half of 2008.

“The recovery in chip sales following an industry overcorrection, and modest growth in our focus markets, helped deliver revenues at the high end of our guidance,” said Harold Hughes, president and chief executive officer at Rambus.  “While there is much work ahead, we continue to progress in our strategy of creating and licensing innovations that make great computing and consumer electronics products possible.”

Total costs and expenses for the third quarter of 2009 were $48.5 million, which included $7.7 million of stock-based compensation expenses and $0.1 million for previous stock-based compensation restatement and related legal expenses.  This is compared to total costs and expenses of $49.3 million for the second quarter of 2009, which included $7.9 million of stock-based compensation expenses and a net recovery of $0.4 million for previous stock-based compensation restatement and related legal expenses. General litigation expenses for the third quarter were $12.0 million, a decrease of $3.0 million from the second quarter of 2009.  Total costs and expenses in the third quarter of last year were $60.0 million, which included $9.0 million of stock-based compensation expenses, $4.0 million of restructuring-related expenses, $2.2 million of asset impairment expenses and $0.4 million of previous stock-based compensation restatement and related legal expenses.  General litigation expenses in the third quarter of 2009 decreased $3.7 million from the third quarter of 2008.

Total costs and expenses for the nine months ended September 30, 2009 were $141.4 million, which included $24.0 million of stock-based compensation expenses and a net recovery of $14.0 million for previous stock-based compensation restatement and related legal expenses.  This is compared to total costs and expenses of $175.6 million for the same period of 2008, which included $28.5 million of stock-based compensation expenses, $4.0 million of restructuring-related expenses, $2.2 million of asset impairment expenses and $3.6 million of previous stock-based compensation restatement and related legal expenses. General litigation expenses for the nine months ended September 30, 2009 were $45.0 million, an increase of $7.0 million from the same period in 2008.

Interest and other expense, net, for the third quarter of 2009 was $6.8 million as compared to $1.6 million in the second quarter of 2009 and $0.3 million in the third quarter of 2008.  Interest and other expense, net, for the nine months ended September 30, 2009 was $9.6 million as compared to interest income of $1.4 million for the same period of 2008.  Prior periods have been adjusted to reflect the impact of the adoption on January 1, 2009 of a FASB staff position which clarifies the accounting for convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement.  The Company has retrospectively adjusted the income statement to include non-cash interest expense of $3.0 million for the third quarter of 2008 and $8.8 million for nine months ended September 30, 2008.

Net loss for the third quarter of 2009 was $27.5 million as compared to a net loss of $24.0 million in the second quarter of 2009 and a net loss of $30.9 million (adjusted for adoption of the FASB staff position) in the third quarter of 2008. Net loss per share for the third quarter of 2009 was $0.26 as compared to a net loss per share of $0.23 in the second quarter of 2009 and a net loss per share of $0.29 (adjusted for adoption of the FASB staff position) for the third quarter of 2008. Net loss for the nine months ended September 30, 2009 was $68.9 million as compared to a net loss of $183.6 million (adjusted for adoption of the FASB staff position) for the same period of 2008. Net loss per share for the nine months ended September 30, 2009 was $0.66 as compared to a net loss per share of $1.75 (adjusted for adoption of the FASB staff position) in the same period of 2008.

Cash, cash equivalents, and marketable securities as of September 30, 2009 were $498.5 million, up approximately $18.1 million from June 30, 2009 and up approximately $152.6 million from December 31, 2008.  During the third quarter of 2009, the Company issued an additional $22.5 million aggregate principal amount of 5% Convertible Senior Notes due 2014 as a result of the underwriters exercising their overallotment option related to the 2014 Notes.  During the nine months ended September 30, 2009, the Company received approximately $168.2 million net proceeds related to the issuance of the 5% Convertible Senior Notes, $7.3 million of insurance proceeds related to reimbursement claims associated with the stock option investigation and derivative lawsuits as well as $4.5 million from former executives due to the resolution of the derivative lawsuits.

The convertible notes are carried at face value less the debt discount associated with the adoption of the FASB staff position for the periods presented. As such, the carrying value of the convertible notes as of December 31, 2008 has been retrospectively adjusted to reflect the impact of the adoption of the FASB staff position.

The conference call discussing third quarter 2009 results will be webcast live via the Rambus Investor Relations website (http://investor.rambus.com) at 2:00 p.m. Pacific Time today.  A replay will be available following the call on Rambus’ Investor Relations website and for one week at the following numbers: (888) 203-1112 (domestic) or (719) 457-0820 (international) with ID# 5928140.
 
About Rambus Inc.
Rambus is one of the world’s premier technology licensing companies specializing in the invention and design of high-speed memory architectures. Additional information is available at www.rambus.com.
 
RMBSFN
 
Contacts:
 
Nicole Noutsios
Investor Relations
Rambus Inc.
(650) 947-5050
nnoutsios@rambus.com
 
Linda Ashmore
Public Relations
Rambus Inc.
(650) 947-5411
lashmore@rambus.com
 
 

 


Press Release Financials
Rambus
 
4440 El Camino Real
 
Los Altos, CA  94022

Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)

 
 
 
September 30,  2009
   
December 31, 2008
 
ASSETS
           
             
Current assets:
           
Cash and cash equivalents
  $ 367,291     $ 116,241  
Marketable securities
    131,192       229,612  
Accounts receivable
    754       1,503  
Prepaids and other current assets
    7,276       8,486  
Deferred taxes
    892       88  
Total current assets
    507,405       355,930  
Restricted cash
    648       632  
Deferred taxes, long-term
    1,069       1,857  
Intangible assets, net
    6,585       7,244  
Property and equipment, net
    15,941       22,290  
Goodwill
    4,454       4,454  
Other assets
    7,653       4,963  
Total assets
  $ 543,755     $ 397,370  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
                 
Current liabilities:
               
Accounts payable
  $ 11,162     $ 6,374  
Accrued salaries and benefits
    8,458       9,859  
Accrued litigation expenses
    6,220       14,265  
Other accrued liabilities
    5,982       3,816  
Convertible notes
    133,312        
Deferred revenue
    395       1,787  
Total current liabilities
    165,529       36,101  
Long-term liabilities:
               
Convertible notes
    109,333       125,474  
Other long-term liabilities
    2,297       2,854  
Total long-term liabilities
    111,630       128,328  
Total stockholders’ equity
    266,596       232,941  
Total liabilities and stockholders’ equity
  $ 543,755     $ 397,370  


 
 

 


Press Release Financials
Rambus
 
4440 El Camino Real
 
Los Altos, CA  94022

Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)

 
 
 
Three Months Ended September 30,
   
Nine Months Ended September 30,
 
 
 
2009
   
2008
   
2009
   
2008
 
       
Revenue:
                       
Royalties
  $ 26,898     $ 25,793     $ 77,826     $ 91,174  
Contract revenue
    976       3,635       4,365       13,707  
Total revenue
    27,874       29,428       82,191       104,881  
Costs and expenses:
                               
Cost of contract revenue (1)
    1,858       4,611       5,479       18,411  
Research and development (1)
    16,727       17,511       50,277       59,048  
Marketing, general and administrative (1)
    29,882       31,288       99,601       88,377  
Restructuring costs (1)
          4,024             4,024  
Impairment of asset
          2,158             2,158  
Costs (recovery) of restatement and related legal activities
    68       392       (14,000 )     3,564  
Total costs and expenses
    48,535       59,984       141,357       175,582  
Operating loss
    (20,661 )     (30,556 )     (59,166 )     (70,701 )
Interest and other income, net
    891       2,704       3,504       10,207  
Interest expense
    (7,641 )     (3,002 )     (13,128 )     (8,834 )
Interest and other income (expense), net
    (6,750 )     (298 )     (9,624 )     1,373  
Loss before income taxes
    (27,411 )     (30,854 )     (68,790 )     (69,328 )
Provision for income taxes
    85       92       103       114,287  
Net loss
  $ (27,496 )   $ (30,946 )   $ (68,893 )   $ (183,615 )
Net loss per share:
                               
Basic
  $ (0.26 )   $ (0.29 )   $ (0.66 )   $ (1.75 )
Diluted
  $ (0.26 )   $ (0.29 )   $ (0.66 )   $ (1.75 )
Weighted average shares used in per share calculation
                               
Basic
    105,182       104,897       104,761       104,795  
Diluted
    105,182       104,897       104,761       104,795  
                                 
___________
 
(1) Total stock-based compensation expense for the three and nine month periods ended September 30, 2009 and September 30, 2008 are presented as follows:
                         
   
Three Months Ended September 30,
   
Nine Months Ended September 30,
 
   
2009
   
2008
   
2009
   
2008
 
Cost of contract revenue
  $ 283     $ 1,321     $ 906     $ 4,604  
Research and development
  $ 2,332     $ 3,326     $ 7,286     $ 10,997  
Marketing, general and administrative
  $ 5,134     $ 4,371     $ 15,826     $ 12,899  
Restructuring costs
  $     $ 547     $     $ 547