10-Q

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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 June 30, 2021

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 name of registrant as specified in its charter)

_______________________________

Delaware	94-3112828
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4453 North First Street
Suite 100
San Jose	,	California	95134
(Address of principal executive offices)			(ZIP Code)

Registrant’s telephone number, including area code:

(408) 462-8000

________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $.001 Par Value	RMBS	The NASDAQ Stock Market LLC
		(The NASDAQ Global Select Market)

Securities registered pursuant to Section 12(g) of the Act:

None

________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange

Act).  Yes ☐  No ☒

The number of shares outstanding of the registrant’s Common Stock, par value $.001 per share, was 108,897,295 as of June 30, 2021.

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RAMBUS INC.

TABLE OF CONTENTS

	PAGE
Note Regarding Forward-Looking Statements	4
PART I. FINANCIAL INFORMATION	6
Item 1. Financial Statements (Unaudited):	6
Condensed Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020	6
Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2021 and 2020 (As Restated)	7
Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2021 and 2020 (As Restated)	8
Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2021 and 2020 (As Restated)	9
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020 (As Restated)	10
Notes to Unaudited Condensed Consolidated Financial Statements	12
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3. Quantitative and Qualitative Disclosures About Market Risk	39
Item 4. Controls and Procedures	40
PART II. OTHER INFORMATION	42
Item 1. Legal Proceedings	42
Item 1A. Risk Factors	42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	60
Item 3. Defaults Upon Senior Securities	61
Item 4. Mine Safety Disclosures	61
Item 5. Other Information	61
Item 6. Exhibits	62
Signature	63

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NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Quarterly Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements include, without limitation, predictions regarding the following aspects of our future:

•Success in the markets of our products and services or our customers’ products;

•Sources of competition;

•Research and development costs and improvements in technology;

•Sources, amounts and concentration of revenue, including royalties;

•Success in signing and renewing license agreements;

•Terms of our licenses and amounts owed under license agreements;

•Technology product development;

•Dispositions, acquisitions, mergers or strategic transactions and our related integration efforts;

•Impairment of goodwill and long-lived assets;

•Pricing policies of our customers;

•Changes in our strategy and business model, including the expansion of our portfolio of inventions, products, software, services and solutions to address additional markets in memory, chip and security;

•Deterioration of financial health of commercial counterparties and their ability to meet their obligations to us;

•Effects of security breaches or failures in our or our customers’ products and services on our business;

•Engineering, sales and general and administration expenses;

•Contract revenue;

•Operating results;

•International licenses, operations and expansion;

•Effects of changes in the economy and credit market on our industry and business;

•Impact of the Novel Coronavirus (“COVID-19”) pandemic on our business operations and financial results;

•Ability to identify, attract, motivate and retain qualified personnel;

•Effects of government regulations on our industry and business;

•Manufacturing, shipping and supply partners, supply chain availability and/or sale and distribution channels;

•Growth in our business;

•Methods, estimates and judgments in accounting policies;

•Adoption of new accounting pronouncements;

•Effective tax rates, including as a result of recent U.S. tax legislation;

•Restructurings and plans of termination;

•Realization of deferred tax assets/release of deferred tax valuation allowance;

•Trading price of our common stock;

•Internal control environment;

•The level and terms of our outstanding debt and the repayment or financing of such debt;

•Protection of intellectual property (“IP”);

•Any changes in laws, agency actions and judicial rulings that may impact the ability to enforce our IP rights;

•Indemnification and technical support obligations;

•Equity repurchase programs;

•Issuances of debt or equity securities, which could involve restrictive covenants or be dilutive to our existing stockholders;

•Effects of fluctuations in interest rates and currency exchange rates; and

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•Outcome and effect of potential future IP litigation and other significant litigation.

You can identify these and other forward-looking statements by the use of words such as “may,” “future,” “shall,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “intends,” “potential,” “continue,” “projecting” or the negative of such terms, or other comparable terminology. Forward-looking statements also include the assumptions underlying or relating to any of the foregoing statements.

Actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under Part II, Item 1A, “Risk Factors.” All forward-looking statements included in this document are based on our assessment of information available to us at this time. We assume no obligation to update any forward-looking statements.

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

RAMBUS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except shares and par value)	June 30, 2021		December 31, 2020 (As Restated)
ASSETS
Current assets:
Cash and cash equivalents	$	204,731	$	128,967
Marketable securities	272,382		373,682
Accounts receivable	38,730		27,903
Unbilled receivables	144,546		138,813
Inventories	8,052		14,466
Prepaids and other current assets	10,544		15,881
Total current assets	678,985		699,712
Intangible assets, net	27,203		36,487
Goodwill	183,222		183,222
Property, plant and equipment, net	50,058		57,693
Operating lease right-of-use assets	25,801		28,708
Deferred tax assets	3,907		4,353
Unbilled receivables	179,503		236,699
Other assets	4,306		4,535
Total assets	$	1,152,985	$	1,251,409
LIABILITIES & STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	8,975	$	8,993
Accrued salaries and benefits	15,878		23,326
Deferred revenue	12,299		10,198
Income taxes payable	19,754		20,064
Operating lease liabilities	6,722		4,724
Other current liabilities	17,798		18,559
Total current liabilities	81,426		85,864
Convertible notes	159,806		156,031
Long-term operating lease liabilities	31,104		34,305
Long-term income taxes payable	31,853		41,333
Deferred tax liabilities	15,147		14,276
Other long-term liabilities	3,061		6,894
Total liabilities	322,397		338,703
Commitments and contingencies (Notes 9, 11 and 15)
Stockholders’ equity:
Convertible preferred stock, $.001 par value:
Authorized: 5,000,000 shares; Issued and outstanding: no shares at June 30, 2021 and December 31, 2020	—		—
Common stock, $.001 par value:
Authorized: 500,000,000 shares; Issued and outstanding: 108,897,295 shares at June 30, 2021 and 111,697,994 shares at December 31, 2020	109		112
Additional paid-in capital	1,257,075		1,270,426
Accumulated deficit	(426,413)		(357,751)
Accumulated other comprehensive loss	(183)		(81)
Total stockholders’ equity	830,588		912,706
Total liabilities and stockholders’ equity	$	1,152,985	$	1,251,409

Refer to Notes to Unaudited Condensed Consolidated Financial Statements

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RAMBUS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited) 

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except per share amounts)	2021		2020 (As Restated)		2021		2020 (As Restated)
Revenue:
Product revenue	$	31,170	$	31,725	$	61,951	$	62,453
Royalties	41,910		18,744		70,769		40,226
Contract and other revenue	11,779		11,248		22,521		24,815
Total revenue	84,859		61,717		155,241		127,494
Cost of revenue:
Cost of product revenue	11,422		10,277		22,832		20,620
Cost of contract and other revenue	1,017		1,535		2,573		2,733
Amortization of acquired intangible assets	4,439		4,336		8,825		8,680
Total cost of revenue	16,878		16,148		34,230		32,033
Gross profit	67,981		45,569		121,011		95,461
Operating expenses:
Research and development	31,469		34,688		63,823		71,352
Sales, general and administrative	22,184		21,721		45,746		45,027
Amortization of acquired intangible assets	229		248		458		596
Restructuring charges	—		—		368		836
Change in fair value of earn-out liability	—		—		—		(1,800)
Total operating expenses	53,882		56,657		110,395		116,011
Operating income (loss)	14,099		(11,088)		10,616		(20,550)
Interest income and other income (expense), net	2,381		4,688		5,362		11,131
Interest expense	(2,683)		(2,580)		(5,297)		(5,135)
Interest and other income (expense), net	(302)		2,108		65		5,996
Income (loss) before income taxes	13,797		(8,980)		10,681		(14,554)
Provision for income taxes	2,631		160		2,128		1,125
Net income (loss)	$	11,166	$	(9,140)	$	8,553	$	(15,679)
Net income (loss) per share:
Basic	$	0.10	$	(0.08)	$	0.08	$	(0.14)
Diluted	$	0.10	$	(0.08)	$	0.07	$	(0.14)
Weighted-average shares used in per share calculation:
Basic	112,144		113,572		112,177		113,240
Diluted	114,931		113,572		115,358		113,240

Refer to Notes to Unaudited Condensed Consolidated Financial Statements

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RAMBUS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020 (As Restated)		2021		2020 (As Restated)
Net income (loss)	$	11,166	$	(9,140)	$	8,553	$	(15,679)
Other comprehensive income (loss):
Foreign currency translation adjustment	4		2		(17)		2
Unrealized gain (loss) on marketable securities, net of tax	(54)		134		(85)		38
Total comprehensive income (loss)	$	11,116	$	(9,004)	$	8,451	$	(15,639)

Refer to Notes to Unaudited Condensed Consolidated Financial Statements

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RAMBUS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

	For the Three Months Ended June 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Gain (Loss)
(In thousands)	Shares	Amount								Total
Balances at March 31, 2021	112,505	$	113	$	1,269,790	$	(360,364)	$	(133)	$	909,406
Net income	—	—		—		11,166		—		11,166
Foreign currency translation adjustment	—	—		—		—		4		4
Unrealized loss on marketable securities, net of tax	—	—		—		—		(54)		(54)
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	407	—		2,836		—		—		2,836
Repurchase and retirement of common stock under repurchase program	(4,015)	(4)		(22,849)		(77,215)		—		(100,068)
Stock-based compensation	—	—		7,298		—		—		7,298
Balances at June 30, 2021	108,897	$	109	$	1,257,075	$	(426,413)	$	(183)	$	830,588
	For the Three Months Ended June 30, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Gain (Loss)
(In thousands)	Shares	Amount								Total
Balances at March 31, 2020 (As Restated)	113,275	$	113	$	1,264,000	$	(292,328)	$	(188)	$	971,597
Net loss (As Restated)	—	—		—		(9,140)		—		(9,140)
Foreign currency translation adjustment	—	—		—		—		2		2
Unrealized gain on marketable securities, net of tax	—	—		—		—		134		134
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	469	1		3,429		—		—		3,430
Stock-based compensation	—	—		6,707		—		—		6,707
Balances at June 30, 2020 (As Restated)	113,744	$	114	$	1,274,136	$	(301,468)	$	(52)	$	972,730

	For the Six Months Ended June 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Gain (Loss)
(In thousands)	Shares	Amount								Total
Balances at December 31, 2020 (As Restated)	111,698	$	112	$	1,270,426	$	(357,751)	$	(81)	$	912,706
Net income	—	—		—		8,553		—		8,553
Foreign currency translation adjustment	—	—		—		—		(17)		(17)
Unrealized loss on marketable securities, net of tax	—	—		—		—		(85)		(85)
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	1,214	1		(4,301)		—		—		(4,300)
Repurchase and retirement of common stock under repurchase program	(4,015)	(4)		(22,849)		(77,215)		—		(100,068)
Stock-based compensation	—	—		13,799		—		—		13,799
Balances at June 30, 2021	108,897	$	109	$	1,257,075	$	(426,413)	$	(183)	$	830,588
	For the Six Months Ended June 30, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Gain (Loss)
(In thousands)	Shares
Balances at December 31, 2019 (As Restated)	112,131	$	112	$	1,261,142	$	(285,789)	$	(92)	$	975,373
Net loss (As Restated)	—	—		—		(15,679)		—		(15,679)
Foreign currency translation adjustment	—	—		—		—		2		2
Unrealized gain on marketable securities, net of tax	—	—		—		—		38		38
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	1,613	2		215		—		—		217
Stock-based compensation	—	—		12,779		—		—		12,779
Balances at June 30, 2020 (As Restated)	113,744	$	114	$	1,274,136	$	(301,468)	$	(52)	$	972,730

Refer to Notes to Unaudited Condensed Consolidated Financial Statements

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RAMBUS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited) 

	Six Months Ended
	June 30,
(In thousands)	2021		2020 (As Restated)
Cash flows from operating activities:
Net income (loss)	$	8,553	$	(15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Stock-based compensation	13,799		12,779
Depreciation	12,753		15,447
Amortization of intangible assets	9,284		9,276
Non-cash interest expense and amortization of convertible debt issuance costs	3,775		3,571
Deferred income taxes	1,317		53
Loss on equity investment	453		318
Loss on disposal of property, plant and equipment	—		2
Change in fair value of earn-out liability	—		(1,800)
Change in operating assets and liabilities:
Accounts receivable	(10,827)		8,841
Unbilled receivables	51,463		79,842
Prepaid expenses and other assets	4,688		1,726
Inventories	6,414		(1,468)
Accounts payable	1,715		1,709
Accrued salaries and benefits and other liabilities	(3,575)		(2,030)
Income taxes payable	(9,747)		(8,643)
Deferred revenue	2,190		(1,106)
Operating lease liabilities	(1,203)		(3,565)
Net cash provided by operating activities	91,052		99,273
Cash flows from investing activities:
Purchases of property, plant, and equipment	(5,267)		(12,780)
Purchases of marketable securities	(333,782)		(487,521)
Maturities of marketable securities	260,924		407,556
Proceeds from sale of marketable securities	174,546		2,496
Settlement of working capital adjustment from disposal of business	—		(1,131)
Net cash provided by (used in) investing activities	96,421		(91,380)
Cash flows from financing activities:
Proceeds received from issuance of common stock under employee stock plans	4,186		7,880
Payments of taxes on restricted stock units	(8,486)		(7,663)
Payments under installment payment arrangements	(7,168)		(6,600)
Repurchase and retirement of common stock, including prepayment under accelerated share repurchase program	(100,068)		—
Net cash used in financing activities	(111,536)		(6,383)
Effect of exchange rate changes on cash and cash equivalents	(168)		(419)
Net increase in cash, cash equivalents and restricted cash	75,769		1,091
Cash, cash equivalents and restricted cash at beginning of period	129,324		102,518
Cash, cash equivalents and restricted cash at end of period	$	205,093	$	103,609
Non-cash investing and financing activities:
Property, plant and equipment received and accrued in accounts payable and other liabilities	$	10,720	$	26,354
Reconciliation of the cash, cash equivalents and restricted cash balances as of June 30, 2021 and December 31, 2020:
	June 30, 2021		December 31, 2020
Cash and cash equivalents	$	204,731	$	128,967
Restricted cash	362		357
Cash, cash equivalents and restricted cash	$	205,093	$	129,324

Refer to Notes to Unaudited Condensed Consolidated Financial Statements

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RAMBUS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Restatement of Condensed Consolidated Financial Statements and Immaterial Correction of Prior-Period Error

Rambus Inc. (the “Company” or “Rambus”) restated its previously issued consolidated financial statements and related disclosures as of and for the fiscal years ended December 31, 2020 and 2019 and presented the impact of the restatement on the relevant unaudited interim financial information for each of the quarterly periods during the years ended December 31, 2020 and 2019 on Form 10-K/A filed on March 29, 2021, in order to correct errors resulting from the incorrect application of generally accepted accounting principles relating to revenue recognition as it pertains to a single customer agreement (the “Impacted Agreement”). Additionally, to correct errors that the Company has determined to be immaterial, both individually and in aggregate, the Company also restated the consolidated financial statements for the fiscal years ended December 31, 2020 and 2019.

Impact of Restatement

The following errors in the Company’s consolidated financial statements were identified and corrected:

a) Correction of revenue related to the Impacted Agreement: During the quarter ended March 31, 2021, the Company determined that a portion of revenue under a single customer agreement that had not yet been recognized, should have been recognized during the quarters ended September 30, 2019, December 31, 2019, March 31, 2020, and June 30, 2020. The Impacted Agreement contained a single performance obligation for a license to the Company’s patents and technology in exchange for consideration, a portion of which was fixed at the inception of the contract and a portion that was dependent on the customer’s applicable sales (as stipulated in the agreement) for the four consecutive quarters commencing on July 1, 2019 and ending on June 30, 2020. The Company accounted for the agreement as a right-to-use IP license agreement with the fixed portion of the consideration appropriately recognized at the inception of the agreement when control of the license was transferred to the customer. However, the Company did not recognize as revenue the portion of the consideration that depended on the customer’s sales beginning in the quarter ended September 30, 2019. During the quarter ended March 31, 2021, the Company reassessed its accounting for this uncertain portion of the consideration and determined that revenue associated with that uncertain portion of the consideration should have been recognized over the four quarters commencing on July 1, 2019 and ending June 30, 2020, which are the periods when the uncertainty surrounding the amount of the contingent consideration was resolved (that is when the customer’s sales occurred for which the contingent payments were based). This error resulted in royalty revenue being corrected by approximately $3.6 million in each of the years ended December 31, 2020 and 2019, resulting in an increase in royalty revenue for each of the respective periods. Unbilled receivables (both current and non-current, as applicable) on the consolidated balance sheets were also increased by the correction, given this additional revenue recognized is payable by the customer in ten equal quarterly installments with the first installment payable in the quarter ended March 31, 2021. Additionally, due to the significant financing component of the Impacted Agreement, immaterial amounts were corrected to increase interest and other income (expense), net, on the consolidated statements of operations.

b) Correction of immaterial asset retirement obligation (“ARO”) related to the Company’s previous Sunnyvale, California headquarters of approximately $1.0 million in fiscal year 2019 related to facility restoration costs. The Company originally recorded a liability for the ARO but expensed (included in sales, general and administrative expenses on the consolidated statements of operations) the entire amount in the year ended December 31, 2019. The Company corrected the consolidated financial statements to record the ARO asset within property, plant and equipment, net, within the consolidated balance sheets and reflect the amortization of the ARO asset over the remaining life of the lease of seven months beginning in December of 2019 through June 2020.

c) Recording of provision for income taxes impacts due to adjustments a) and b) above.

The restatement tables below present a reconciliation from the previously reported amounts to the restated amounts (in thousands, except shares and per share amounts). The amounts originally reported were derived from the Company’s Quarterly Report on Form 10-Q for the interim period ended June 30, 2020. Certain line items in the quarterly financial data below were excluded because they were not impacted by the restatement.

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	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	16,957	$	1,787	$	18,744
Total revenue	59,930		1,787		61,717
Gross profit	43,782		1,787		45,569
Operating expenses:
Sales, general and administrative	21,310		411		21,721
Total operating expenses	56,246		411		56,657
Operating income (loss)	(12,464)		1,376		(11,088)
Interest income and other income (expense), net	4,597		91		4,688
Interest and other income (expense), net	2,017		91		2,108
Income (loss) before income taxes	(10,447)		1,467		(8,980)
Provision for (benefit from) income taxes	334		(174)		160
Net income (loss)	(10,781)		1,641		(9,140)
Net income (loss) per share:
Basic	$	(0.09)	$	0.01	$	(0.08)
Diluted	$	(0.09)	$	0.01	$	(0.08)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	36,651	$	3,575	$	40,226
Total revenue	123,919		3,575		127,494
Gross profit	91,886		3,575		95,461
Operating expenses:
Sales, general and administrative	44,205		822		45,027
Total operating expenses	115,189		822		116,011
Operating income (loss)	(23,303)		2,753		(20,550)
Interest income and other income (expense), net	10,971		160		11,131
Interest and other income (expense), net	5,836		160		5,996
Income (loss) before income taxes	(17,467)		2,913		(14,554)
Provision for (benefit from) income taxes	1,297		(172)		1,125
Net income (loss)	(18,764)		3,085		(15,679)
Net income (loss) per share:
Basic	$	(0.17)	$	0.03	$	(0.14)
Diluted	$	(0.17)	$	0.03	$	(0.14)

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	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(10,781)	$	1,641	$	(9,140)
Total comprehensive income (loss)	(10,645)		1,641		(9,004)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Total comprehensive income (loss)	(18,724)		3,085		(15,639)

	For the Three and Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Stockholders’ Equity
Net loss attributable to:
Accumulated deficit	$	(309,008)	$	7,540	$	(301,468)
Total stockholders’ equity	965,190		7,540		972,730

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities:
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation	14,625		822		15,447
Deferred income taxes	102		(49)		53
Change in operating assets and liabilities, net of effects of acquisitions:
Unbilled receivables	83,577		(3,735)		79,842
Prepaid expenses and other assets	1,849		(123)		1,726
Net cash provided by operating activities	99,273		—		99,273

Immaterial Correction of Prior-Period Error

Subsequent to the reissuance of the consolidated financial statements as of and for the year ended December 31, 2020, the Company determined that $7.2 million in corporate investments originally classified as cash equivalents should have been classified as marketable securities in the consolidated balance sheet as of December 31, 2020. The Company assessed the effect of this correction based on an analysis of both quantitative and qualitative factors and determined that the correction was not material. Accordingly, the Company corrected the error as of December 31, 2020 in the accompanying condensed consolidated balance sheet and related footnotes. The following adjustments were made:

•Cash and cash equivalents as of December 31, 2020 originally reported as $136.1 million was corrected to $129.0 million.

•Marketable securities as of December 31, 2020 originally reported as $366.5 million was corrected to $373.6 million.

•Correction of Note 7, “Marketable Securities” and Note 8, “Fair Value of Financial Instruments”, to reflect the above adjustments.

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Additionally, in the 10-K for the period ending December 31, 2021, the Company will correct its presentation of net cash used in investing activities for the year ended December 31, 2020, which was originally reported as $90.4 million, to reflect cash used in investing activities of $97.6 million. The corrections did not affect the net cash provided by operating activities nor net cash used in financing activities.

1A. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Rambus Inc. (“Rambus” or the “Company”) and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the accompanying unaudited condensed consolidated financial statements.

In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring items) necessary to state fairly the financial position and results of operations for each interim period presented. Interim results are not necessarily indicative of results for a full year.

The unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) applicable to interim financial information. Certain information and Note disclosures included in the financial statements prepared in accordance with generally accepted accounting principles have been omitted in these interim statements pursuant to such SEC rules and regulations. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto in Form 10-K/A for the year ended December 31, 2020.

2. Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted

In January 2020, the FASB issued ASU No. 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815).” The amendments in this ASU clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. This ASU is effective for interim and annual reporting periods beginning after December 15, 2020. The Company adopted this ASU on January 1, 2021 on a prospective basis. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40).” The amendments in this ASU simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Among other changes, the guidance removes the liability and equity separation models for convertible instruments. Instead, entities will account for convertible debt instruments wholly as debt unless convertible instruments contain features that require bifurcation as a derivative or that result in substantial premiums accounted for as paid-in capital. The guidance also requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share. The guidance is effective for fiscal years beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020, and can be adopted on either a retrospective or modified retrospective basis. The Company will adopt this guidance on January 1, 2022. Although the Company continues to evaluate the method of adoption and impact of this guidance on its consolidated financial statements, upon adoption the Company expects this guidance to result in a reclassification of the conversion feature balances from additional paid-in capital to debt and in a decrease of reported interest expense for its convertible notes.

3. Revenue Recognition

Contract Balances

The contract assets are primarily related to the Company’s fixed fee IP licensing arrangements and rights to consideration for performance obligations delivered but not billed as of June 30, 2021.

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The Company’s contract balances were as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Unbilled receivables	$	324,049	$	375,512
Deferred revenue	12,651		10,461

During the six months ended June 30, 2021, the Company recognized $8.3 million of revenue that was included in the contract balances as of December 31, 2020. During the six months ended June 30, 2020, the Company recognized $9.7 million of revenue that was included in the contract balances as of December 31, 2019.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Contracted but unsatisfied performance obligations were approximately $15.0 million as of June 30, 2021, which the Company primarily expects to recognize over the next 2 years.

4. Earnings (Loss) Per Share

Basic earnings (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing the earnings by the weighted-average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of incremental common shares issuable upon exercise of stock options, employee stock purchases, restricted stock and restricted stock units and shares issuable upon the conversion of convertible notes. The dilutive effect of outstanding shares is reflected in diluted earnings per share by application of the treasury stock method. This method includes consideration of the amounts to be paid by the employees and the amount of unrecognized stock-based compensation related to future services. No potential dilutive common shares are included in the computation of any diluted per share amount when a net loss is reported.

The following table sets forth the computation of basic and diluted net income (loss) per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except per share amounts)	2021		2020 (As Restated)		2021		2020 (As Restated)
Net income (loss) per share:
Numerator:
Net income (loss)	$	11,166	$	(9,140)	$	8,553	$	(15,679)
Denominator:
Weighted-average shares outstanding - basic	112,144		113,572		112,177		113,240
Effect of potential dilutive common shares	2,787		—		3,181		—
Weighted-average shares outstanding - diluted	114,931		113,572		115,358		113,240
Basic net income (loss) per share	$	0.10	$	(0.08)	$	0.08	$	(0.14)
Diluted net income (loss) per share	$	0.10	$	(0.08)	$	0.07	$	(0.14)

For the three and six months ended June 30, 2020, an additional 1.7 million and 2.1 million shares, respectively, were excluded from the weighted-average dilutive shares because there was a net loss position for the periods. During the three and six months ended June 30, 2021, the Company’s stock price exceeded the 2023 Notes' conversion price of $18.93 per share, therefore approximately 0.5 million shares for each of the three and six months ended June 30, 2021, were included in the weighted-average dilutive shares. Under the treasury stock method, the cumulative dilutive effect of the 2023 Notes would be approximately 9.1 million shares. Refer to Note 10, “Convertible Notes.”

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5. Intangible Assets and Goodwill

Goodwill

The following tables present goodwill information for the six months ended June 30, 2021:

(In thousands)	As of December 31, 2020		Adjustment to Goodwill		As of June 30, 2021
Total goodwill	$	183,222	$	—	$	183,222

	As of June 30, 2021
(In thousands)	Gross Carrying Amount		Accumulated Impairment Losses		Net Carrying Amount
Total goodwill	$	204,992	$	(21,770)	$	183,222

Intangible Assets, Net

The components of the Company’s intangible assets as of June 30, 2021 and December 31, 2020 were as follows:

		As of June 30, 2021
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	265,389	$	(239,875)	$	25,514
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,604)		1,689
Non-compete agreements and trademarks	3 years	300		(300)		—
Total intangible assets		$	301,982	$	(274,779)	$	27,203

		As of December 31, 2020
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	263,789	$	(230,950)	$	32,839
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,245)		2,048
Non-compete agreements and trademarks	3 years	300		(300)		—
In-process research and development	Not applicable	1,600		—		1,600
Total intangible assets		$	301,982	$	(265,495)	$	36,487

During the three and six months ended June 30, 2021, the Company did not purchase or sell any intangible assets.

Amortization expense for intangible assets for the three and six months ended June 30, 2021 was $4.7 million and $9.3 million, respectively. Amortization expense for intangible assets for the three and six months ended June 30, 2020 was $4.6 million and $9.3 million, respectively.

The estimated future amortization of intangible assets as of June 30, 2021 was as follows (in thousands):

Years Ending December 31:	Amount
2021 (remaining six months)	$	5,540
2022	7,964
2023	7,260
2024	5,812
2025	520
Thereafter	107
Total intangible assets	$	27,203

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6. Segments and Major Customers

Operating segments are based upon Rambus’ internal organization structure, the manner in which its operations are managed, the criteria used by its Chief Operating Decision Maker (“CODM”) to evaluate segment performance and availability of separate financial information regularly reviewed for resource allocation and performance assessment.

The Company has determined its CODM to be the Chief Executive Officer (“CEO”). The CEO reviews financial information presented on a consolidated basis for purposes of managing the business, allocating resources, making operating decisions and assessing financial performance. On this basis, the Company is organized and operates as a single segment within the semiconductor space. As of June 30, 2021, the Company has a single operating and reportable segment.

Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable at June 30, 2021 and December 31, 2020, respectively, was as follows:

	As of
Customer	June 30, 2021		December 31, 2020
Customer 1	13	%	13	%
Customer 2	11	%	*
Customer 3	10	%	14	%
Customer 4	*		11	%

_________________________________________

*    Customer accounted for less than 10% of total accounts receivable in the period.

Revenue from the Company’s major customers representing 10% or more of total revenue for the three and six months ended June 30, 2021 and 2020, respectively, was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Customer	2021		2020 (As Restated)		2021		2020 (As Restated)
Customer A	16	%	15	%	19	%	13	%
Customer B	*		18	%	11	%	16	%
Customer C	13	%	*		*		*

_________________________________________

*    Customer accounted for less than 10% of total revenue in the period.

Revenue from customers in the geographic regions based on the location of contracting parties was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020 (As Restated)		2021		2020 (As Restated)
USA	$	45,541	$	32,014	$	91,692	$	66,802
Taiwan	9,018		3,752		17,861		10,816
South Korea	2,209		701		2,597		2,521
Japan	3,826		7,943		8,414		12,574
Europe	1,187		4,944		1,633		5,682
Canada	38		31		92		543
Singapore	14,330		8,802		20,668		16,432
Asia-Other	8,710		3,530		12,284		12,124
Total	$	84,859	$	61,717	$	155,241	$	127,494

7. Marketable Securities

Rambus invests its excess cash and cash equivalents primarily in U.S. government-sponsored obligations, commercial paper, corporate notes and bonds, money market funds and municipal notes and bonds that mature within three years.

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All cash equivalents and marketable securities are classified as available-for-sale. Total cash, cash equivalents and marketable securities are summarized as follows:

	As of June 30, 2021
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	19,262	$	19,262	$	—	$	—	0.03	%
U.S. Government bonds and notes	64,103		64,118		1		(16)		0.08	%
Corporate notes, bonds and commercial paper	208,279		208,407		12		(140)		0.20	%
Total cash equivalents and marketable securities	291,644		291,787		13		(156)
Cash	185,469		185,469		—		—
Total cash, cash equivalents and marketable securities	$	477,113	$	477,256	$	13	$	(156)

	As of December 31, 2020
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	18,162	$	18,162	$	—	$	—	0.01	%
U.S. Government bonds and notes	169,633		169,670		3		(40)		0.12	%
Corporate notes, bonds and commercial paper	253,391		253,412		61		(82)		0.20	%
Total cash equivalents and marketable securities	441,186		441,244		64		(122)
Cash	61,463		61,463		—		—
Total cash, cash equivalents and marketable securities	$	502,649	$	502,707	$	64	$	(122)

Available-for-sale securities are reported at fair value on the balance sheets and classified along with cash as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Cash equivalents	$	19,262	$	67,504
Short-term marketable securities	272,382		373,682
Total cash equivalents and marketable securities	291,644		441,186
Cash	185,469		61,463
Total cash, cash equivalents and marketable securities	$	477,113	$	502,649

The Company continues to invest in highly rated and highly liquid debt securities. The Company holds all of its marketable securities as available-for-sale, marks them to market, and regularly reviews its portfolio to ensure adherence to its investment policy and to monitor individual investments for risk analysis, proper valuation, and unrealized losses that may be other than temporary.

The estimated fair value and gross unrealized losses of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position at June 30, 2021 and December 31, 2020 are as follows:

	Fair Value				Gross Unrealized Losses
(In thousands)	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Less than 12 months
U.S. Government bonds and notes	$	54,628	$	70,548	$	(16)	$	(40)
Corporate notes, bonds and commercial paper	149,777		181,349		(140)		(82)
Total cash equivalents and marketable securities in a continuous unrealized loss position	$	204,405	$	251,897	$	(156)	$	(122)

The gross unrealized losses at June 30, 2021 and December 31, 2020 were not material in relation to the Company’s total available-for-sale portfolio. The gross unrealized losses can be primarily attributed to a combination of market conditions as well as the demand for and duration of the U.S. government-sponsored obligations and corporate notes and bonds. The Company reasonably believes that there is no need to sell these investments and that it can recover the amortized cost of these investments. The Company has found no evidence of impairment due to credit losses in its portfolio. Therefore, these

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unrealized losses were recorded in other comprehensive income (loss). However, the Company cannot provide any assurance that its portfolio of cash, cash equivalents and marketable securities will not be impacted by adverse conditions in the financial markets, which may require the Company in the future to record an impairment charge for credit losses which could adversely impact its financial results.

The contractual maturities of cash equivalents (excluding money market funds which have no maturity) and marketable securities are summarized as follows:

(In thousands)	June 30, 2021
Due less than one year	$	196,592
Due from one year through three years	75,790
Total	$	272,382

Refer to Note 8, “Fair Value of Financial Instruments,” for discussion regarding the fair value of the Company’s cash equivalents and marketable securities.

8. Fair Value of Financial Instruments

The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the below pricing levels as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	19,262	$	19,262	$	—	$	—
U.S. Government bonds and notes	64,103		—		64,103		—
Corporate notes, bonds and commercial paper	208,279		—		208,279		—
Total available-for-sale securities	$	291,644	$	19,262	$	272,382	$	—

	As of December 31, 2020
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	18,162	$	18,162	$	—	$	—
U.S. Government bonds and notes	169,633		—		169,633		—
Corporate notes, bonds and commercial paper	253,391		—		253,391		—
Total available-for-sale securities	$	441,186	$	18,162	$	423,024	$	—

The Company monitors its investments for other-than-temporary impairment and records appropriate reductions in carrying value when necessary. The Company monitors its investments for other-than-temporary losses by considering current factors, including the economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, reductions in carrying values when necessary and the Company’s ability and intent to hold the investment for a period of time which may be sufficient for anticipated recovery in the market. Any other-than-temporary loss is reported under “Interest and other income (expense), net” on the condensed consolidated statement of operations.

During the second half of 2018, the Company made an investment in a non-marketable equity security of a private company. This equity investment is accounted for under the equity method of accounting, and the Company accounts for its equity method share of the income (loss) on a quarterly basis. As of June 30, 2021, the Company’s 25.0% ownership percentage amounted to a $2.4 million equity interest in this equity investment and it was included in other assets on the accompanying consolidated balance sheets. The Company recorded immaterial amounts on its consolidated statements of operations representing its share of the investee’s loss for the six months ended June 30, 2021 and 2020.

During the three and six months ended June 30, 2021 and 2020, there were no transfers of financial instruments between different categories of fair value.

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The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021						As of December 31, 2020
(In thousands)	Face  Value		Carrying  Value		Fair Value		Face  Value		Carrying  Value		Fair Value
1.375% Convertible Senior Notes due 2023 (the “2023 Notes”)	$	172,500	$	159,806	$	227,760	$	172,500	$	156,031	$	194,709

The fair value of the convertible notes at each balance sheet date is determined based on recent quoted market prices for these notes which is a level 2 measurement. As discussed in Note 10, “Convertible Notes,” as of June 30, 2021, the convertible notes were carried at their face value of $172.5 million, less any unamortized debt discount and unamortized debt issuance costs. The carrying value of other financial instruments, including accounts receivable, accounts payable and other liabilities, approximated fair value due to their short maturities.

9. Leases

The Company leases office space, domestically and internationally, under operating leases. The Company’s leases have remaining lease terms generally between one year and ten years. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, and long-term operating lease liabilities on the Company’s unaudited condensed consolidated balance sheets. The Company does not have any finance leases.

The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of June 30, 2021 (in thousands):

Years ending December 31,	Amount
2021 (remaining six months)	$	4,330
2022	7,384
2023	4,573
2024	3,925
2025	4,043
Thereafter	21,325
Total minimum lease payments	45,580
Less: amount of lease payments representing interest	(7,754)
Present value of future minimum lease payments	37,826
Less: current obligations under leases	(6,722)
Long-term lease obligations	$	31,104

As of June 30, 2021, the weighted-average remaining lease term for the Company’s operating leases was 8.0 years and the weighted-average discount rate used to determine the present value of the Company’s operating leases was 4.3%.

Operating lease costs included in research and development and selling, general and administrative costs on the condensed consolidated statements of operations were $1.9 million and $2.9 million for the three months ended June 30, 2021 and 2020, respectively. Operating lease costs included in research and development and selling, general and administrative costs on the condensed consolidated statements of operations were $3.7 million and $5.8 million for the six months ended June 30, 2021 and 2020, respectively.

Cash paid for amounts included in the measurement of operating lease liabilities were $4.3 million and $4.3 million for the six months ended June 30, 2021 and 2020, respectively.

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10. Convertible Notes

The Company’s convertible notes are shown in the following table:

	As of
(In thousands)	June 30, 2021		December 31, 2020
2023 Notes	$	172,500	$	172,500
Unamortized discount — 2023 Notes	(11,896)		(15,420)
Unamortized debt issuance costs — 2023 Notes	(798)		(1,049)
Total convertible notes	159,806		156,031
Less current portion	—		—
Total long-term convertible notes	$	159,806	$	156,031

Interest expense related to the notes for the three and six months ended June 30, 2021 and 2020 was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020		2021		2020
2023 Notes coupon interest at a rate of 1.375%	$	593	$	593	$	1,186	$	1,186
2023 Notes amortization of discount and debt issuance cost at an additional effective interest rate of 4.9%	1,901		1,798		3,775		3,571
Total interest expense on convertible notes	$	2,494	$	2,391	$	4,961	$	4,757

11. Commitments and Contingencies

As of June 30, 2021, the Company’s material contractual obligations were as follows:

(In thousands)	Total		Remainder of 2021		2022		2023		2024		2025
Contractual obligations (1) (2)
Software licenses (3)	$	11,746	$	5,317	$	6,429	$	—	$	—	$	—
Acquisition retention bonuses (4)	6,370		3,370		3,000		—		—		—
Convertible notes	172,500		—		—		172,500		—		—
Interest payments related to convertible notes	4,750		1,186		2,372		1,192		—		—
Total	$	195,366	$	9,873	$	11,801	$	173,692	$	—	$	—

_________________________________________

(1)    The above table does not reflect possible payments in connection with unrecognized tax benefits of approximately $27.2 million including $24.0 million recorded as a reduction of long-term deferred tax assets and $3.2 million in long-term income taxes payable as of June 30, 2021. As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

(2)    For the Company’s lease commitments as of June 30, 2021, refer to Note 9, “Leases.”

(3)    The Company has commitments with various software vendors for agreements generally having terms longer than one year.

(4)    In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment.

Indemnifications

From time to time, the Company indemnifies certain customers as a necessary means of doing business. Indemnification covers customers for losses suffered or incurred by them as a result of any patent, copyright, or other intellectual property infringement or any other claim by any third party arising as result of the applicable agreement with the Company. The

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Company generally attempts to limit the maximum amount of indemnification that the Company could be required to make under these agreements to the amount of fees received by the Company, however, this may not always be possible. The fair value of the liability as of June 30, 2021 and December 31, 2020 was not material.

12. Equity Incentive Plans and Stock-Based Compensation

A summary of shares available for grant under the Company’s plans is as follows:

	Shares Available  for Grant
Total shares available for grant as of December 31, 2020	12,412,320
Stock options forfeited	51,477
Nonvested equity stock and stock units granted (1) (2)	(3,369,905)
Nonvested equity stock and stock units forfeited (1)	1,155,509
Total shares available for grant as of June 30, 2021	10,249,401

_________________________________________

(1)    For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each restricted stock granted reduces the number of shares available for grant by 1.5 shares and each restricted stock forfeited increases shares available for grant by 1.5 shares.

(2)    Amount includes approximately 0.4 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2021 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below.

General Stock Option Information

The following table summarizes stock option activity under the Company’s equity incentive plans for the six months ended June 30, 2021 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of June 30, 2021.

	Options Outstanding
(In thousands, except per share amounts and years)	Number of  Shares	Weighted-  Average  Exercise Price  Per Share		Weighted-  Average  Remaining  Contractual  Term (years)	Aggregate  Intrinsic  Value
Outstanding as of December 31, 2020	964,211	$	11.08
Options granted	—	$	—
Options exercised	(99,458)	$	11.29
Options forfeited	(51,477)	$	15.09
Outstanding as of June 30, 2021	813,276	$	10.80	4.5	$	10,497
Vested or expected to vest at June 30, 2021	812,918	$	10.80	4.4	$	10,493
Options exercisable at June 30, 2021	728,233	$	10.54	4.1	$	9,590

Employee Stock Purchase Plan

Under the 2015 Employee Stock Purchase Plan (“2015 ESPP”), the Company issued 263,933 shares at a price of $11.58 per share and 277,838 shares at a price of $10.51 per share during the six months ended June 30, 2021 and 2020, respectively. As of June 30, 2021, approximately 2.9 million shares under the 2015 ESPP remained available for issuance.

Stock-Based Compensation

For the six months ended June 30, 2021 and 2020, the Company maintained stock plans covering a broad range of potential equity grants including stock options, nonvested equity stock and equity stock units and performance based instruments. In addition, the Company sponsors the 2015 ESPP, whereby eligible employees are entitled to purchase common stock semi-annually, by means of limited payroll deductions, at a 15% discount from the fair market value of the common stock as of specific dates.

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Stock Options

There were no stock options granted during the three and six months ended June 30, 2021 and 2020, respectively. During the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense related to stock options of $0.1 million and $0.2 million, respectively. During the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense related to stock options of $0.1 million and $0.3 million, respectively.

As of June 30, 2021, there was $0.7 million of total unrecognized compensation cost, net of expected forfeitures, related to non-vested stock-based compensation arrangements granted under the stock option plans. That cost is expected to be recognized over a weighted-average period of 1.6 years.

Employee Stock Purchase Plan

For the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense related to the 2015 ESPP of $0.2 million and $0.8 million, respectively. For the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense related to the 2015 ESPP of $0.2 million and $0.7 million, respectively. As of June 30, 2021, there was $0.4 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under the 2015 ESPP. That cost is expected to be recognized over four months.

Valuation Assumptions

The fair value of stock awards is estimated as of the grant date using the Black-Scholes-Merton (“BSM”) option-pricing model assuming a dividend yield of 0% and the additional weighted-average assumptions as listed in the table below.

There were no stock options granted during the three and six months ended June 30, 2021 and 2020, respectively.

	Employee Stock Purchase Plan
	Six Months Ended
	June 30,
	2021	2020
Employee Stock Purchase Plan:
Expected stock price volatility	32%	46%
Risk free interest rate	0.04%	0.12%
Expected term (in years)	0.5	0.5
Weighted-average fair value of purchase rights granted under the purchase plan	$4.53	$3.50

Nonvested Equity Stock and Stock Units

The Company grants nonvested equity stock units to officers, employees and directors. During the three and six months ended June 30, 2021, the Company granted nonvested equity stock units totaling approximately 0.1 million and 2.0 million shares, respectively. During the three and six months ended June 30, 2020, the Company granted nonvested equity stock units totaling approximately 0.1 million and 1.9 million shares, respectively. These awards have a service condition, generally a service period of four years, except in the case of grants to directors, for which the service period is one year. For the three and six months ended June 30, 2021, the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $2.8 million and $41.3 million, respectively. For the three and six months ended June 30, 2020, the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $1.7 million and $29.3 million, respectively. During the first quarters of 2021 and 2020, the Company granted performance unit awards to certain Company executive officers with vesting subject to the achievement of certain performance and/or market conditions. The ultimate number of performance units that can be earned can range from 0% to 200% of target depending on performance relative to target over the applicable period. The shares earned will vest on the third anniversary of the date of grant. The Company’s shares available for grant have been reduced to reflect the shares that could be earned at the maximum target.

For the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense of approximately $7.0 million and $12.9 million, respectively, related to all outstanding nonvested equity stock grants. For the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense of approximately $6.3 million and $11.8 million, respectively, related to all outstanding nonvested equity stock grants. Unrecognized stock-based compensation related to all nonvested equity stock grants, net of estimated forfeitures, was approximately $51.5 million at June 30, 2021. This amount is expected to be recognized over a weighted-average period of 2.3 years.

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The following table reflects the activity related to nonvested equity stock and stock units for the six months ended June 30, 2021:

Nonvested Equity Stock and Stock Units	Shares	Weighted-  Average  Grant-Date  Fair Value
Nonvested at December 31, 2020	4,851,265	$	12.82
Granted	1,998,321	$	20.68
Vested	(1,287,156)	$	12.35
Forfeited	(585,690)	$	15.01
Nonvested at June 30, 2021	4,976,740	$	15.84

13. Stockholders’ Equity

Share Repurchase Programs

On October 29, 2020, the Board approved a new share repurchase program authorizing the repurchase of up to an aggregate of 20.0 million shares (the “2020 Repurchase Program”). Share repurchases under the 2020 Repurchase Program may be made through the open market, established plans or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the 2020 Repurchase Program. During the six months ended June 30, 2021, the Company repurchased shares of its common stock under the 2020 Repurchase Program as discussed below.

On November 11, 2020, the Company entered into an accelerated share repurchase program with Deutsche Bank AG, London Branch as counterparty, through its agent Deutsche Bank Securities Inc. (“Deutsche Bank”) (the “2020 ASR Program”). The 2020 ASR Program was part of the share repurchase program previously authorized by the Company’s Board on October 29, 2020. Under the 2020 ASR Program, the Company pre-paid to Deutsche Bank the $50.0 million purchase price for its common stock and, in turn, the Company received an initial delivery of approximately 2.6 million shares of its common stock from Deutsche Bank in the fourth quarter of 2020, which were retired and recorded as a $40.0 million reduction to stockholders’ equity. The remaining $10.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to the Company’s stock. During the second quarter of 2021, the accelerated share repurchase program was completed and the Company received an additional 0.1 million shares of its common stock as the final settlement of the accelerated share repurchase program.

On June 15, 2021, the Company entered into an accelerated share repurchase program with Deutsche Bank (the “2021 ASR Program”). The 2021 ASR Program was part of the share repurchase program previously authorized by the Company’s Board on October 29, 2020. Under the 2021 ASR Program, the Company pre-paid to Deutsche Bank the $100.0 million purchase price for its common stock and, in turn, the Company received an initial delivery of approximately 3.9 million shares of its common stock from Deutsche Bank in the second quarter of 2021, which were retired and recorded as a $80.0 million reduction to stockholders’ equity. The remaining $20.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to the Company’s stock.

The number of shares to be ultimately purchased by the Company will be determined based on the volume-weighted average price of the Company’s common stock during the term of the transaction, minus an agreed upon discount between the parties. The 2021 ASR Program is expected to be completed within six months from the beginning of the program.

During the six months ended June 30, 2021, there were no other repurchases of the Company’s common stock under the 2020 Repurchase Program.

As of June 30, 2021, there remained an outstanding authorization to repurchase approximately 13.4 million shares of the Company’s outstanding common stock under the 2020 Repurchase Program.

The Company records stock repurchases as a reduction to stockholders’ equity. The Company records a portion of the purchase price of the repurchased shares as an increase to accumulated deficit when the price of the shares repurchased exceeds the average original proceeds per share received from the issuance of common stock. During the six months ended June 30, 2021, the cumulative price of $77.2 million was recorded as an increase to accumulated deficit.

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14. Income Taxes

The Company recorded a provision for income taxes of $2.6 million and $0.2 million for the three months ended June 30, 2021 and 2020, respectively, and $2.1 million and $1.1 million for the six months ended June 30, 2021 and 2020, respectively. The provision for income taxes for the three and six months ended June 30, 2021 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the statutory tax expense for the foreign jurisdictions for 2021, the valuation allowance on the Canadian deferred tax assets, and indefinite-lived intangible tax amortization expense. The provision for income taxes for the three and six months ended June 30, 2020 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the projected annual effective tax rate for the foreign jurisdictions for 2020, partial California deferred tax asset valuation allowance release, and indefinite-lived intangible tax amortization expense.

During the three months ended June 30, 2021 and 2020, the Company paid withholding taxes of $5.0 million and $5.1 million, respectively. During the six months ended June 30, 2021 and 2020, the Company paid withholding taxes of $10.5 million and $9.6 million, respectively.

The Company periodically evaluates the realizability of its net deferred tax assets based on all available evidence, both positive and negative. During the third quarter of 2018, the Company assessed the changes in its underlying facts and circumstances and evaluated the realizability of its existing deferred tax assets based on all available evidence, both positive and negative, and the weight accorded to each, and concluded a full valuation allowance associated with U.S. federal and California deferred tax assets was appropriate. The Company continues to maintain a full valuation allowance against its U.S. federal deferred tax assets. During 2020, as a result of the enactment of California A.B. 85 and the temporary suspension of California net operating loss utilization for tax years 2020 through 2022, the Company released $0.7 million of the valuation allowance on its deferred tax asset for California research and development tax credits. The Company continues to maintain a full valuation allowance on the remainder of its California deferred tax assets as it does not expect to be able to fully utilize them.

The Company has U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax attributes that can be used to offset U.S. federal taxable income in future periods. These credit carryforwards will expire if they are not used within certain time periods. It is possible that some or all of these attributes could ultimately expire unused.

The Company maintains liabilities for uncertain tax positions within its long-term income taxes payable accounts and as a reduction to existing deferred tax assets to the extent tax attributes are available to offset such liabilities. These liabilities involve judgment and estimation and are monitored by management based on the best information available including changes in tax regulations, the outcome of relevant court cases and other information.

As of June 30, 2021, the Company had approximately $144.7 million of unrecognized tax benefits, including $24.0 million recorded as a reduction of long-term deferred tax assets, $117.5 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea (Korea), and $3.2 million recorded in long-term income taxes payable. If recognized, $3.2 million would be recorded as an income tax benefit. As a result of recent court rulings in Korea, the Company has determined that they may be entitled to refund claims for foreign taxes previously withheld from licensees in Korea. The Company recognizes that there are numerous risks and uncertainties associated with the ultimate collection of this refund and has therefore maintained an offsetting reserve for the entire amount of refundable withholding taxes previously withheld in Korea. As of December 31, 2020, the Company had $134.0 million of unrecognized tax benefits, including $23.6 million recorded as a reduction of long-term deferred tax assets, $109 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea, and $1.9 million recorded in long-term income taxes payable.

Although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

The Company recognizes interest and penalties related to uncertain tax positions as a component of the income tax provision. At June 30, 2021 and December 31, 2020, an immaterial amount of interest and penalties is included in long-term income taxes payable.

Rambus files income tax returns for the U.S., California, India, the U.K., the Netherlands and various other state and foreign jurisdictions. The U.S. federal returns are subject to examination from 2016 and forward. The California returns are subject to examination from 2010 and forward. In addition, any research and development credit carryforward or net operating loss carryforward generated in prior years and utilized in these or future years may also be subject to examination. The India returns are subject to examination from fiscal year ending March 2012 and forward. The Company is currently under examination by California for the 2010, 2011, 2016 and 2018 tax years, and by New York for the 2017 through 2019 tax years. The Company’s India subsidiary is under examination by the Indian tax administration for tax years beginning with 2011, except for 2014, which was assessed in the Company’s favor. These examinations may result in proposed adjustments to the income taxes as

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filed during these periods. Management regularly assesses the likelihood of outcomes resulting from income tax examinations to determine the adequacy of their provision for income taxes and believes their provision for unrecognized tax benefits is adequate.

Additionally, the Company’s future effective tax rates could be adversely affected by earnings being higher than anticipated in countries where the Company has higher statutory rates or lower than anticipated in countries where it has lower statutory rates, by changes in valuation of its deferred tax assets and liabilities or by changes in tax laws or interpretations of those laws.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. The CARES Act includes a number of federal income tax law changes, including, but not limited to (1) permitting net operating loss carrybacks to offset 100% of taxable income for taxable years beginning before 2021, (2) accelerating alternative minimum tax credit refunds, (3) temporarily increasing the allowable business interest deduction from 30% to 50% of adjusted taxable income, and (4) providing a technical correction for depreciation related to qualified improvement property. The CARES Act did not have a material impact on the Company’s condensed consolidated financial statements.

15. Litigation and Asserted Claims

Rambus is not currently a party to any material pending legal proceeding; however, from time to time, Rambus may become involved in legal proceedings or be subject to claims arising in the ordinary course of its business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on our business, operating results, financial position or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management attention and resources and other factors.

The Company records a contingent liability when it is probable that a loss has been incurred and the amount is reasonably estimable in accordance with accounting for contingencies.

16. Restructuring Charges

2020 Restructuring Plan

In November 2020, the Company initiated a restructuring plan to reduce overall expenses which is expected to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2020 Restructuring Plan”). In connection with this restructuring plan, the Company initiated a plan of termination resulting in a reduction of approximately 70 employees. During the six months ended June 30, 2021, the Company recorded additional charges of approximately $0.4 million related primarily to the reduction in workforce. No charge was recorded during the three months ended June 30, 2021. The 2020 Restructuring Plan was completed in the second quarter of 2021.

2019 Restructuring Plan

In June 2019, the Company initiated a restructuring plan to reduce overall expenses to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2019 Restructuring Plan”). In connection with the 2019 Restructuring Plan, the Company initiated a plan of termination resulting in a reduction of approximately 80 employees. During 2020, the Company recorded a charge of approximately $0.8 million related to the reduction in workforce. The 2019 Restructuring Plan was substantially completed in the second quarter of 2020.

17. Subsequent Events

AnalogX Inc.

On July 2, 2021, the Company completed its acquisition of all of the outstanding shares of AnalogX Inc. (“AnalogX”). AnalogX is a premier interconnect IP company. The Company acquired AnalogX for total cash consideration of approximately $47.7 million, including certain deferred payments and working capital adjustments, pursuant to the terms of the Purchase Agreement.

In accordance with ASC 805, “Business Combinations,” the acquisitions of AnalogX will be recorded as purchase business acquisitions in the Company’s financial results for the three and nine months ended September 30, 2021. Given the timing of the completion of the AnalogX acquisition, the Company is currently in the process of valuing the assets acquired and liabilities assumed in the acquisition. As a result, the Company is unable to provide the amount recognized as of the acquisition date for the major classes of assets acquired and liabilities assumed and certain disclosures pertaining to the deferred payments. The

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Company will provide these disclosures in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2021.

PLDA Group

On June 16, 2021, the Company announced that it had entered into an agreement to acquire PLDA Group (“PLDA”). PLDA is a provider of high-speed interconnect solutions. The Company will acquire PLDA for an initial cash consideration of approximately $60 million and 0.3 million shares of the Company’s common stock. In addition, pursuant to the terms of an earn-out agreement, based upon the achievement of certain milestones, the Company will issue shares of the Company’s common stock, up to the following maximum amounts: 0.3 million shares after the first anniversary of the transaction, 0.4 million shares after the second anniversary, and 0.5 million shares after the third anniversary. The transaction with PLDA, which is subject to customary closing conditions and approvals, is expected to close in the third quarter of 2021.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 as described in more detail under “Note Regarding Forward-Looking Statements.” Our forward-looking statements are based on current expectations, forecasts and assumptions and are subject to risks, uncertainties and changes in condition, significance, value and effect. As a result of the factors described herein, and in the documents incorporated herein by reference, including, in particular, those factors described under “Risk Factors,” we undertake no obligation to publicly disclose any revisions to these forward-looking statements to reflect events or circumstances occurring subsequent to filing this report with the Securities and Exchange Commission.

Rambus is a trademark of Rambus Inc. Other trademarks that may be mentioned in this quarterly report on Form 10-Q are the property of their respective owners.

The following information has been adjusted to reflect the restatement of our consolidated financial statements for the three and six months ended June 30, 2020 as described in Note 1, “Restatement of Condensed Consolidated Financial Statements and Immaterial Correction of Prior-Period Error,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q.

Business Overview

Rambus produces products and innovations that address the fundamental challenges of accelerating data. We make industry-leading chips and silicon IP that enable critical performance improvements for data center and other growing markets. The ongoing shift to the cloud, along with the widespread advancement of AI across the data center, 5G, automotive and IoT, has led to exponential growth in data usage and tremendous demands on data infrastructure. Creating fast and safe connections, both in and across systems, remains one of the most mission-critical design challenges limiting performance in advanced hardware for these markets.

As an industry pioneer with over 30 years of advanced semiconductor experience in interconnect technologies, Rambus is ideally positioned to address the challenges of moving and protecting data. We are a leader in high-performance memory subsystems, providing chips, silicon IP and innovations that maximize the performance and security in data-intensive systems. Whether in the cloud, at the edge or in your hand, real-time and immersive applications depend on data throughput and integrity. Rambus products and innovations deliver the increased bandwidth, capacity and security required to meet the world’s data needs and drive ever-greater end-user experiences.

Our strategic objectives are focusing our product portfolio and research around our core strength in semiconductors, optimizing our operational efficiency, and leveraging our strong cash generation to re-invest for growth. We continue to maximize synergies across our businesses and customer base, leveraging the significant overlap in our ecosystem of customers, partners and influencers. The Rambus product and technology roadmap, as well as our go-to-market strategy, is driven by the application-specific requirements of our focus markets.

Executive Summary

The Company’s continued execution delivered strong results during the second quarter, driven by continued demand in our memory interface chips, continued design wins in Silicon IP and continued stability from our royalties revenue bolstered by recent patent license renewals. We initiated a $100 million accelerated share repurchase program. We also accelerated our roadmap of data center solutions with the CXL Memory Interconnect Initiative and announced the acquisitions of AnalogX and PLDA.

Key 2021 second quarter financial results included:

•Revenue of $84.9 million;

•Operating expenses of $53.9 million; and

•Net cash provided by operating activities of approximately $51.6 million.

Operational Highlights

Revenue Sources

The Company’s consolidated revenue is comprised of product revenue, contract and other revenue and royalties.

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Product revenue consists primarily of memory interface chips and is a significant and growing segment of the business. Our memory interface chips are sold to major DRAM manufacturers, Micron, Samsung and SK hynix, as well as directly to system manufacturers and cloud providers, for integration into server memory modules. Product revenue accounted for 37% and 40% of our consolidated revenue for the three and six months ended June 30, 2021, as compared to 51% and 49% for the three and six months ended June 30, 2020.

Contract and other revenue consists primarily of Silicon IP, which is comprised of our high-speed interface and security IP. Revenue sources under contract and other include our IP core licenses, software licenses and related implementation, support and maintenance fees, and engineering services fees. The timing and amounts invoiced to customers can vary significantly depending on specific contract terms and can therefore have a significant impact on deferred revenue or accounts receivable in any given period. Contract and other revenue accounted for 14% and 15% of our consolidated revenue for the three and six months ended June 30, 2021, as compared to 18% and 19% for the three and six months ended June 30, 2020.

Royalty revenue is derived from our patent licenses, through which we provide our customers certain rights to our broad worldwide portfolio of patented inventions. Our patent licenses enable our customers to use a portion of our patent portfolio in their own digital electronics products. The licenses typically range in term up to ten years and define the specific field of use where our customers may utilize our inventions in their products. Royalties may be structured as fixed, variable or a hybrid of fixed and variable royalty payments. Leading semiconductor and electronic system companies such as AMD, Broadcom, Cisco, CXMT, IBM, Infineon, Kioxia, Marvell, Mediatek, Micron, Nanya, NVIDIA, Panasonic, Phison, Qualcomm, Samsung, SK hynix, Socionext, STMicroelectronics, Toshiba, Western Digital, Winbond, and Xilinx have licensed our patents. The vast majority of our patents originate from our internal research and development efforts. Revenues from royalties accounted for 49% and 46% of our consolidated revenue for the three and six months ended June 30, 2021, as compared to 30% and 32% for the three and six months ended June 30, 2020.

Costs and Expenses

Cost of product revenue for the three months ended June 30, 2021 increased approximately $1.1 million as compared to the same period in 2020. Cost of product revenue for the six months ended June 30, 2021 increased approximately $2.2 million as compared to the same period in 2020. The increase in both periods was primarily due to increases in sales volumes during the respective periods.

Cost of contract and other revenue for the three months ended June 30, 2021 decreased by approximately $0.5 million as compared to the same period in 2020. Cost of contract and other revenue for the six months ended June 30, 2021 decreased slightly by approximately $0.1 million as compared to the same period in 2020.

Research and development expenses continue to play a key role in our efforts to drive our product innovations. Our research and development expenses for the three months ended June 30, 2021 decreased $3.2 million as compared to the same period in 2020, primarily due to decreased headcount-related expenses of $1.0 million, facilities costs of $0.8 million, retention bonus expense related to acquisitions of $0.7 million, engineering development tool costs of $0.6 million and bonus expense of $0.4 million, offset by increased consulting costs of $0.4 million. Research and development expenses for the six months ended June 30, 2021 decreased $7.6 million as compared to the same period in 2020, primarily due to decreased headcount-related expenses of $2.1 million, facilities costs of $1.6 million, retention bonus expense related to acquisitions of $1.5 million, engineering development tool costs of $1.1 million, allocated information technology costs of $1.0 million and prototyping costs of $0.6 million, offset by increased consulting costs of $0.2 million and bonus expense of $0.1 million.

Sales, general and administrative expenses for the three months ended June 30, 2021 increased $0.5 million for the three months ended June 30, 2021 as compared to the same period in 2020, primarily due to increased acquisition-related costs (including retention bonus expense) of $1.4 million, allocated information technology costs of $0.6 million and stock-based compensation expense of $0.6 million, offset by decreased facilities costs of $1.0 million, consulting costs of $0.6 million and headcount-related expenses of $0.4 million. Sales, general and administrative expenses for the six months ended June 30, 2021 increased $0.7 million as compared to the same period in 2020, primarily due to increased consulting, legal and accounting costs of $3.0 million related to the shareholder activism activity and restatement matters, acquisition-related costs (including retention bonus expense) of $1.2 million, allocated information technology costs of $1.0 million and stock-based compensation expense of $0.9 million, offset by decreased facilities costs of $1.7 million, headcount-related expenses of $0.9 million, other consulting costs of $0.9 million, equipment maintenance costs of $0.5 million, bonus accrual expense of $0.4 million, depreciation expense of $0.4 million, sales and marketing costs of $0.3 million and other accounting costs of $0.3 million.

Intellectual Property

As of June 30, 2021, our semiconductor, security, and other technologies are covered by 2,425 U.S. and foreign patents. Additionally, we have 587 patent applications pending. Some of the patents and pending patent applications are derived from a common parent patent application or are foreign counterpart patent applications. We have a program to file applications for and

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obtain patents in the United States and in selected foreign countries where we believe filing for such protection is appropriate and would further our overall business strategy and objectives. In some instances, obtaining appropriate levels of protection may involve prosecuting continuation and counterpart patent applications based on a common parent application. We believe our patented innovations provide our customers with the ability to achieve improved performance, lower risk, greater cost-effectiveness, and other benefits in their products and services.

Impact of the COVID-19 Pandemic

In December 2019, the Novel Coronavirus (COVID-19) was reported in China, in January 2020 the World Health Organization (“WHO”) declared it a Public Health Emergency of International Concern, and in March 2020 the WHO declared it a pandemic. The COVID-19 pandemic has created significant global economic uncertainty and may adversely impact the business of our customers, partners and vendors. The extent of the impact of the Novel Coronavirus (COVID-19) on our operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, impact on our customers and our sales cycles, and impact on our partners or employees, all of which are uncertain and cannot be predicted. The extent to which the Novel Coronavirus (COVID-19) may impact our financial condition or results of operations remains uncertain. Actual results could differ from any estimates and any such differences could be material to our financial statements. Furthermore, the effect of the Novel Coronavirus (COVID-19) may not be fully reflected in our results of operations until future periods, if at all.

Trends

There are a number of trends that may have a material impact on us in the future, including but not limited to, the evolution of memory and SerDes technology, adoption of security solutions, the use and adoption of our inventions or technologies generally, industry consolidation, and global economic conditions with the resulting impact on sales of consumer electronic systems.

We have a high degree of revenue concentration. Our top five customers represented approximately 55% and 56% of our revenue for the three and six months ended June 30, 2021 as compared to 54% and 51% for the three and six months ended June 30, 2020. The particular customers which account for revenue concentration have varied from period-to-period as a result of the addition of new contracts, expiration of existing contracts, renewals of existing contracts, industry consolidation, and the volumes and prices at which the customers have recently sold to their customers. These variations are expected to continue in the foreseeable future.

Our revenue from companies headquartered outside of the United States accounted for approximately 46% and 41% of our total revenue for the three and six months ended June 30, 2021 as compared to 48% for both the three and six months ended June 30, 2020. We expect that revenue derived from international customers will continue to represent a significant portion of our total revenue in the future. Currently, our revenue from international customers is denominated in U.S. dollars. For additional information concerning international revenue, refer to Note 6, “Segments and Major Customers,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q.

The royalties we receive from our semiconductor customers are partly a function of the adoption of our technologies by system companies. Many system companies purchase semiconductors containing our technologies from our customers and do not have a direct contractual relationship with us. Our customers generally do not provide us with details as to the identity or volume of licensed semiconductors purchased by particular system companies. As a result, we face difficulty in analyzing the extent to which our future revenue will be dependent upon particular system companies. Several of our licensees have renewed or extended their license agreements with us during the six months ended June 30, 2021 including Qualcomm, Kioxia and Western Digital.

As a part of our overall business strategy, from time to time, we evaluate businesses and technologies for potential acquisitions that are aligned with our core business and designed to supplement our growth, including the 2021 announced agreements to acquire AnalogX and PLDA, as well as the 2019 acquisitions of Northwest Logic and the Secure Silicon IP and Protocols business from Verimatrix, formerly Inside Secure. Similarly, we evaluate our current businesses and technologies that are not aligned with our core business for potential divestiture, such as the sale of our Payments and Ticketing businesses to Visa International Service Association in 2019. We expect to continue to evaluate and potentially enter into strategic acquisitions or divestitures which may adversely impact our business and operating results.

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Results of Operations

The following table sets forth, for the periods indicated, the percentage of total revenue represented by certain items reflected on our unaudited condensed consolidated statements of operations:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020 (As Restated)		2021		2020 (As Restated)
Revenue:
Product revenue	36.7	%	51.4	%	39.9	%	49.0	%
Royalties	49.4	%	30.4	%	45.6	%	31.6	%
Contract and other revenue	13.9	%	18.2	%	14.5	%	19.4	%
Total revenue	100.0	%	100.0	%	100.0	%	100.0	%
Cost of revenue:
Cost of product revenue	13.5	%	16.7	%	14.7	%	16.2	%
Cost of contract and other revenue	1.2	%	2.5	%	1.7	%	2.1	%
Amortization of acquired intangible assets	5.2	%	7.0	%	5.7	%	6.8	%
Total cost of revenue	19.9	%	26.2	%	22.1	%	25.1	%
Gross profit	80.1	%	73.8	%	77.9	%	74.9	%
Operating expenses:
Research and development	37.1	%	56.2	%	41.1	%	55.9	%
Sales, general and administrative	26.1	%	35.2	%	29.5	%	35.3	%
Amortization of acquired intangible assets	0.3	%	0.4	%	0.3	%	0.5	%
Restructuring charges	—	%	—	%	0.2	%	0.7	%
Change in fair value of earn-out liability	—	%	—	%	—	%	(1.4)	%
Total operating expenses	63.5	%	91.8	%	71.1	%	91.0	%
Operating income (loss)	16.6	%	(18.0)	%	6.8	%	(16.1)	%
Interest income and other income (expense), net	2.8	%	7.7	%	3.5	%	8.7	%
Interest expense	(3.2)	%	(4.2)	%	(3.4)	%	(4.0)	%
Interest and other income (expense), net	(0.4)	%	3.5	%	0.1	%	4.7	%
Income (loss) before income taxes	16.2	%	(14.5)	%	6.9	%	(11.4)	%
Provision for income taxes	3.0	%	0.3	%	1.4	%	0.9	%
Net income (loss)	13.2	%	(14.8)	%	5.5	%	(12.3)	%

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020 (As Restated)		Percentage		2021		2020 (As Restated)		Percentage
Total Revenue:
Product revenue	$	31.2	$	31.7	(1.7)	%	$	62.0	$	62.5	(0.8)	%
Royalties	41.9		18.7		123.6	%	70.7		40.2		75.9	%
Contract and other revenue	11.8		11.3		4.7	%	22.5		24.8		(9.2)	%
Total revenue	$	84.9	$	61.7	37.5	%	$	155.2	$	127.5	21.8	%

Product Revenue

Product revenue consists of revenue from the sale of memory and security products. Product revenue decreased approximately $0.5 million to $31.2 million for the three months ended June 30, 2021 from $31.7 million for the same period in 2020. Product revenue decreased approximately $0.5 million to $62.0 million for the six months ended June 30, 2021 from $62.5 million for the same period in 2020. The decrease in both periods was due to lower sales of our memory interface chips.

We believe that product revenue will increase in 2021 as compared to 2020, mainly from the sale of our memory interface chips. However, our ability to continue to grow product revenue is dependent on, among other things, our ability to continue to obtain orders from customers and our ability to meet our customers’ demands.

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Royalties

Our royalties, which include patent and technology license royalties, increased approximately $23.2 million to $41.9 million for the three months ended June 30, 2021 from $18.7 million for the same period in 2020. Our royalty revenue increased approximately $30.5 million to $70.7 million for the six months ended June 30, 2021 from $40.2 million for the same period in 2020. The increase in both periods was primarily due to the timing and structure of renewals.

We are continuously in negotiations for licenses with prospective customers. We expect patent royalties will continue to vary from period to period based on our success in adding new customers, renewing or extending existing agreements, as well as the level of variation in our customers’ reported shipment volumes, sales price and mix, offset in part by the proportion of customer payments that are fixed or hybrid in nature. We also expect that our technology royalties will continue to vary from period to period based on our customers’ shipment volumes, sales prices, and product mix.

Contract and Other Revenue

Contract and other revenue consists of revenue from technology development projects. Contract and other revenue increased approximately $0.5 million to $11.8 million for the three months ended June 30, 2021 from $11.3 million for the same period in 2020. The increase was primarily due to higher revenue associated with our Silicon IP offerings. Contract and other revenue decreased approximately $2.3 million to $22.5 million for the six months ended June 30, 2021 from $24.8 million for the same period in 2020. The decrease was primarily due to lower revenue associated with our Silicon IP offerings.

We believe that contract and other revenue will fluctuate over time based on our ongoing technology development contractual requirements, the amount of work performed, the timing of completing engineering deliverables, and the changes to work required, as well as new technology development contracts booked in the future.

Cost of Product Revenue

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Cost of product revenue	$	11.4	$	10.3	11.1	%	$	22.8	$	20.6	10.7	%

Cost of product revenue increased approximately $1.1 million to $11.4 million for the three months ended June 30, 2021 from $10.3 million for the same period in 2020. Cost of product revenue increased approximately $2.2 million to $22.8 million for the six months ended June 30, 2021 from $20.6 million for the same period in 2020. The increase for both periods was primarily due to increases in sales volumes during the respective periods.

In the near term, we expect costs of product revenue to be higher as we expect higher sales of our various products in 2021 as compared to 2020.

Cost of Contract and Other Revenue

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Cost of contract and other revenue	$	1.0	$	1.5	(33.7)	%	$	2.6	$	2.7	(5.9)	%

Cost of contract and other revenue for the three months ended June 30, 2021 decreased by approximately $0.5 million as compared to the same period in 2020. Cost of contract and other revenue for the six months ended June 30, 2021 decreased slightly by approximately $0.1 million as compared to the same period in 2020.

In the near term, we expect costs of contract and other revenue to vary from period to period based on varying revenue recognized from contract and other revenue.

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Research and Development Expenses

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Research and development expenses:
Research and development expenses	$	29.0	$	32.2	(9.9)	%	$	58.7	$	66.3	(11.3)	%
Stock-based compensation	2.5		2.5		(1.8)	%	5.1		5.1		(1.2)	%
Total research and development expenses	$	31.5	$	34.7	(9.3)	%	$	63.8	$	71.4	(10.6)	%

Total research and development expenses decreased $3.2 million for the three months ended June 30, 2021 as compared to the same period in 2020, primarily due to decreased headcount-related expenses of $1.0 million, facilities costs of $0.8 million, retention bonus expense related to acquisitions of $0.7 million, engineering development tool costs of $0.6 million and bonus expense of $0.4 million, offset by increased consulting costs of $0.4 million.

Total research and development expenses decreased $7.6 million for the six months ended June 30, 2021 as compared to the same period in 2020, primarily due to decreased headcount-related expenses of $2.1 million, facilities costs of $1.6 million, retention bonus expense related to acquisitions of $1.5 million, engineering development tool costs of $1.1 million, allocated information technology costs of $1.0 million and prototyping costs of $0.6 million, offset by increased consulting costs of $0.2 million and bonus expense of $0.1 million.

In the near term, we expect research and development expenses to be higher as we continue to make investments in the infrastructure and technologies required to maintain our product innovation in semiconductor, security and other technologies.

Sales, General and Administrative Expenses

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020 (As Restated)		Percentage		2021		2020 (As Restated)		Percentage
Sales, general and administrative expenses:
Sales, general and administrative expenses	$	17.4	$	17.5	(0.6)	%	$	37.1	$	37.3	(0.5)	%
Stock-based compensation	4.8		4.2		13.5	%	8.6		7.7		12.0	%
Total sales, general and administrative expenses	$	22.2	$	21.7	2.1	%	$	45.7	$	45.0	1.6	%

Total sales, general and administrative expenses increased $0.5 million for the three months ended June 30, 2021 as compared to the same period in 2020, primarily due to increased acquisition-related costs (including retention bonus expense) of $1.4 million, allocated information technology costs of $0.6 million and stock-based compensation expense of $0.6 million, offset by decreased facilities costs of $1.0 million, consulting costs of $0.6 million and headcount-related expenses of $0.4 million.

Total sales, general and administrative expenses increased $0.7 million for the six months ended June 30, 2021 as compared to the same period in 2020, primarily due to increased consulting, legal and accounting costs of $3.0 million related to the shareholder activism activity and restatement matters, acquisition-related costs (including retention bonus expense) of $1.2 million, allocated information technology costs of $1.0 million and stock-based compensation expense of $0.9 million, offset by decreased facilities costs of $1.7 million, headcount-related expenses of $0.9 million, other consulting costs of $0.9 million, equipment maintenance costs of $0.5 million, bonus accrual expense of $0.4 million, depreciation expense of $0.4 million, sales and marketing costs of $0.3 million and other accounting costs of $0.3 million.

In the future, sales, general and administrative expenses will vary from period to period based on the trade shows, advertising, legal, acquisition and other sales, marketing and administrative activities undertaken, and the change in sales, marketing and administrative headcount in any given period. In the near term, we expect our sales, general and administrative expenses to remain relatively flat.

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Amortization of Acquired Intangible Assets

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Amortization of acquired intangible assets:
Amortization of acquired intangible assets included in total cost of revenue	$	4.4	$	4.3	2.4	%	$	8.8	$	8.7	1.7	%
Amortization of acquired intangible assets included in total operating expenses	0.2		0.3		(7.7)	%	0.5		0.6		(23.2)	%
Total amortization of acquired intangible assets	$	4.6	$	4.6	1.8	%	$	9.3	$	9.3	0.1	%

Amortization of acquired intangible assets recognized in cost of revenue and operating expenses for the three and six months ended June 30, 2021 remained flat as compared to the same periods in 2020.

Restructuring Charges

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Restructuring charges	$	—	$	—	—	%	$	0.4	$	0.8	(56.0)	%

In November 2020, we initiated a restructuring plan to reduce overall expenses to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2020 Restructuring Plan”). During the six months ended June 30, 2021, we recorded additional restructuring charges of $0.4 million, primarily related to headcount costs.

Refer to Note 16, “Restructuring Charges,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q for further discussion.

Change in Fair Value of Earn-Out Liability

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020		Percentage		2021		2020		Percentage
Change in fair value of earn-out liability	$	—	$	—	—	%	$	—	$	(1.8)	(100.0)	%

During the first quarter of 2020, we recorded a reduction in the fair value of the earn-out liability related to the 2019 asset purchase agreement to acquire the Secure Silicon IP and Protocols business from Verimatrix, formerly Inside Secure, based on its then-current fair value in light of the likely achievement of the specified performance milestones, resulting in a gain on our condensed consolidated statements of operations.

Interest and Other Income (Expense), Net

	Three Months Ended						Six Months Ended
	June 30,				Change in		June 30,				Change in
(Dollars in millions)	2021		2020 (As Restated)		Percentage		2021		2020 (As Restated)		Percentage
Interest income and other income (expense), net	$	2.4	$	4.7	(49.2)	%	$	5.4	$	11.1	(51.8)	%
Interest expense	(2.7)		(2.6)		4.0	%	(5.3)		(5.1)		3.2	%
Interest and other income (expense), net	$	(0.3)	$	2.1	(114.3)	%	$	0.1	$	6.0	(98.9)	%

Interest income and other income (expense), net, consists primarily of interest income of $2.4 million and $5.2 million for the three and six months ended June 30, 2021, respectively, due to the significant financing component of licensing agreements. Interest income and other income (expense), net, also includes interest income generated from investments in high quality fixed income securities and any gains or losses from the re-measurement of our monetary assets or liabilities denominated in foreign currencies.

Interest expense primarily consists of interest expense associated with the non-cash interest expense related to the amortization of the debt discount and issuance costs on the 1.375% convertible senior notes due 2023 (the “2023 Notes”), as

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well as the coupon interest related to these notes. We expect our non-cash interest expense to increase steadily as the notes reach maturity.

Provision for Income Taxes

	Three Months Ended							Six Months Ended
	June 30,						Change in	June 30,						Change in
(Dollars in millions)	2021			2020 (As Restated)			Percentage	2021			2020 (As Restated)			Percentage
Provision for income taxes	$	2.6		$	0.2		*	$	2.1		$	1.1		89.2	%
Effective tax rate	19.1		%	(1.8)		%		19.9		%	(7.7)		%

_____________________________________

*    Percentage is not meaningful

The provision for income taxes reported for the three and six months ended June 30, 2021 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the statutory tax expense for the foreign jurisdictions for 2021, the valuation allowance on the Canadian deferred tax assets, and indefinite-lived intangible tax amortization expense. Our income tax provision for the three months ended June 30, 2021 and 2020 reflected an effective tax rate of 19.1% and (1.8)%, respectively. Our income tax provision for the six months ended June 30, 2021 and 2020 reflected an effective tax rate of 19.9% and (7.7)%, respectively. Our effective tax rate for the three and six months ended June 30, 2021 differed from the statutory rate primarily due to foreign tax credits and the full valuation allowance against U.S. deferred tax assets. Our effective tax rate for the three and six months ended June 30, 2020 differed from the statutory rate primarily due to U.S. and foreign current taxes payable and no benefit for current losses due to the full valuation allowance against U.S. deferred tax assets.

We recorded a provision for income taxes of $2.6 million and $0.2 million for the three months ended June 30, 2021 and 2020, respectively, and $2.1 million and $1.1 million for the six months ended June 30, 2021 and 2020, respectively. During the three months ended June 30, 2021 and 2020, we paid withholding taxes of $5.0 million and $5.1 million, respectively. During the six months ended June 30, 2021 and 2020, we paid withholding taxes of $10.5 million and $9.6 million, respectively.

We periodically evaluate the realizability of our net deferred tax assets based on all available evidence, both positive and negative. During the third quarter of 2018, we assessed the changes in our underlying facts and circumstances and evaluated the realizability of our existing deferred tax assets based on all available evidence, both positive and negative, and the weight accorded to each, and concluded a full valuation allowance associated with U.S. federal and California deferred tax assets was appropriate. During 2020, as a result of the enactment of California A.B. 85 and the temporary suspension of California net operating loss utilization for tax years 2020 through 2022, we released $0.7 million of the valuation allowance on our deferred tax asset for California research and development tax credits. We continue to maintain a full valuation allowance on the remainder of our California and U.S. federal deferred tax assets as we do not expect to be able to fully utilize them.

We have U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax attributes that can be used to offset U.S. federal taxable income in future periods. These credit carryforwards will expire if they are not used within certain time periods. It is possible that some or all of these attributes could ultimately expire unused.

Liquidity and Capital Resources

	As of
(In millions)	June 30, 2021		December 31, 2020
Cash and cash equivalents	$	204.7	$	129.0
Marketable securities	272.4		373.6
Total cash, cash equivalents, and marketable securities	$	477.1	$	502.6

	Six Months Ended
	June 30,
(In millions)	2021		2020 (As Restated)
Net cash provided by operating activities	$	91.1	$	99.3
Net cash provided by (used in) investing activities	$	96.4	$	(91.4)
Net cash used in financing activities	$	(111.5)	$	(6.4)

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Liquidity

We currently anticipate that existing cash, cash equivalents and marketable securities balances and cash flows from operations will be adequate to meet our cash needs for at least the next 12 months. Additionally, the majority of our cash and cash equivalents is in the United States. Our cash needs for the six months ended June 30, 2021 were funded primarily from cash collected from our customers.

We do not anticipate any liquidity constraints as a result of either the current credit environment or investment fair value fluctuations. Additionally, we have the intent and ability to hold our debt investments that have unrealized losses in accumulated other comprehensive gain (loss) for a sufficient period of time to allow for recovery of the principal amounts invested. Further, we have no significant exposure to European sovereign debt. We continually monitor the credit risk in our portfolio and mitigate our credit risk exposures in accordance with our policies.

As a part of our overall business strategy, from time to time, we evaluate businesses and technologies for potential acquisitions that are aligned with our core business and designed to supplement our growth.

To provide us with more flexibility in returning capital to our stockholders, on October 29, 2020, our Board approved the 2020 Repurchase Program authorizing the repurchase of up to an aggregate of 20.0 million shares. Share repurchases under the 2020 Repurchase Program may be made through the open market, established plans or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the 2020 Repurchase Program.

On November 11, 2020, we entered into the 2020 ASR Program with Deutsche Bank. The 2020 ASR Program was part of the 2020 Repurchase Program. Under the 2020 ASR Program, we pre-paid to Deutsche Bank the $50.0 million purchase price for our common stock and, in turn, we received an initial delivery of approximately 2.6 million shares of our common stock from Deutsche Bank in the fourth quarter of 2020, which were retired and recorded as a $40.0 million reduction to stockholders’ equity. The remaining $10.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to our stock. During the second quarter of 2021, the accelerated share repurchase program was completed and we received an additional 0.1 million shares of our common stock as the final settlement of the accelerated share repurchase program.

On June 15, 2021, we entered into the 2021 ASR Program with Deutsche Bank. The 2021 ASR Program was part of the 2020 Repurchase Program. Under the 2021 ASR Program, we pre-paid to Deutsche Bank the $100.0 million purchase price for our common stock and, in turn, we received an initial delivery of approximately 3.9 million shares of our common stock from Deutsche Bank in the second quarter of 2021, which were retired and recorded as $80.0 million reduction to stockholders’ equity. The remaining $20.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to our stock.

As of June 30, 2021, there remained an outstanding authorization to repurchase approximately 13.4 million shares of our outstanding common stock under the 2020 Repurchase Program. Refer to “Share Repurchase Program” below.

Operating Activities

Cash provided by operating activities of $91.1 million for the six months ended June 30, 2021 was primarily attributable to the cash generated from customer licensing, product sales and engineering services fees. Changes in operating assets and liabilities for the six months ended June 30, 2021 primarily included decreases in unbilled receivables, inventories, prepaids and other current assets and an increase in deferred revenue, offset by increases in accounts receivable, as well as decreases in income taxes payable and accrued salaries and benefits.

Cash provided by operating activities of $99.3 million for the six months ended June 30, 2020 was primarily attributable to the cash generated from customer licensing, product sales and engineering services fees. Changes in operating assets and liabilities for the six months ended June 30, 2020 primarily included decreases in accounts receivable, unbilled receivables, income taxes payable and accrued salaries and benefits, offset by increases in inventories and accounts payable.

Investing Activities

Cash provided by investing activities of $96.4 million for the six months ended June 30, 2021 consisted of proceeds from the maturities and sale of available-for-sale marketable securities of $260.9 million and $174.5 million, respectively, offset by purchases of available-for-sale marketable securities of $333.8 million and $5.3 million paid to acquire property, plant and equipment.

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Cash used in investing activities of $91.4 million for the six months ended June 30, 2020 consisted of purchases of available-for-sale marketable securities of $487.5 million, $12.8 million paid to acquire property, plant and equipment, and $1.1 million paid to settle a net working capital adjustment related to the divestiture of the Company’s Payments and Ticketing businesses, offset by proceeds from the maturities and sale of available-for-sale marketable securities of $407.6 million and $2.5 million, respectively.

Financing Activities

Cash used in financing activities of $111.5 million for the six months ended June 30, 2021 was primarily due to an aggregate payment of $100.0 million to Deutsche Bank as part of the 2021 ASR Program. We also paid $8.5 million in payments of taxes on restricted stock units, $7.2 million under installment payment arrangements to acquire fixed assets and $0.1 million in fees related to the 2021 ASR Program, offset by $4.2 million in proceeds from the issuance of common stock under equity incentive plans.

Cash used in financing activities of $6.4 million for the six months ended June 30, 2020 was primarily due to $7.7 million in payments of taxes on restricted stock units and $6.6 million in payments under installment payment arrangements to acquire fixed assets, offset by $7.9 million in proceeds from the issuance of common stock under equity incentive plans.

Contractual Obligations

As of June 30, 2021, our material contractual obligations were as follows:

(In thousands)	Total		Remainder of 2021		2022		2023		2024		2025
Contractual obligations (1) (2)
Software licenses (3)	$	11,746	$	5,317	$	6,429	$	—	$	—	$	—
Acquisition retention bonuses (4)	6,370		3,370		3,000		—		—		—
Convertible notes	172,500		—		—		172,500		—		—
Interest payments related to convertible notes	4,750		1,186		2,372		1,192		—		—
Total	$	195,366	$	9,873	$	11,801	$	173,692	$	—	$	—

_________________________________________

(1)    The above table does not reflect possible payments in connection with unrecognized tax benefits of approximately $27.2 million including $24.0 million recorded as a reduction of long-term deferred tax assets and $3.2 million in long-term income taxes payable as of June 30, 2021. As noted in Note 14, “Income Taxes,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q, although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, we cannot reasonably estimate the outcome at this time.

(2)    For our lease commitments as of June 30, 2021, refer to Note 9, “Leases,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q.

(3)    We have commitments with various software vendors for agreements generally having terms longer than one year.

(4)    In connection with the acquisitions of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, we are obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment.

Share Repurchase Program

On October 29, 2020, our Board approved the 2020 Repurchase Program authorizing the repurchase of up to an aggregate of 20.0 million shares. Share repurchases under the 2020 Repurchase Program may be made through the open market, established plans or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the 2020 Repurchase Program. During the six months ended June 30, 2021, we repurchased shares of our common stock under the 2020 Repurchase Program as discussed below.

On November 11, 2020, we entered into the 2020 ASR Program with Deutsche Bank. The 2020 ASR Program was part of the 2020 Repurchase Program. Under the 2020 ASR Program, we pre-paid to Deutsche Bank the $50.0 million purchase price for our common stock and, in turn, we received an initial delivery of approximately 2.6 million shares of our common stock from Deutsche Bank in the fourth quarter of 2020, which were retired and recorded as a $40.0 million reduction to stockholders’ equity. The remaining $10.0 million of the initial payment was recorded as a reduction to stockholders’ equity as

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an unsettled forward contract indexed to our stock. During the second quarter of 2021, the accelerated share repurchase program was completed and we received an additional 0.1 million shares of our common stock as the final settlement of the accelerated share repurchase program.

On June 15, 2021, we entered into the 2021 ASR Program with Deutsche Bank. The 2021 ASR Program was part of the share repurchase program previously authorized by our Board on October 29, 2020. Under the 2021 ASR Program, we pre-paid to Deutsche Bank the $100.0 million purchase price for our common stock and, in turn, we received an initial delivery of approximately 3.9 million shares of our common stock from Deutsche Bank in the second quarter of 2021, which were retired and recorded as a $80.0 million reduction to stockholders’ equity. The remaining $20.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to our stock.

The number of shares to be ultimately purchased by us will be determined based on the volume-weighted average price of our common stock during the term of the transaction, minus an agreed upon discount between the parties. The 2021 ASR Program is expected to be completed within six months from the beginning of the program.

During the six months ended June 30, 2021, there were no other repurchases of our common stock under the 2020 Repurchase Program.

As of June 30, 2021, there remained an outstanding authorization to repurchase approximately 13.4 million shares of our outstanding common stock under the 2020 Repurchase Program.

We record stock repurchases as a reduction to stockholders’ equity. We record a portion of the purchase price of the repurchased shares as an increase to accumulated deficit when the price of the shares repurchased exceeds the average original proceeds per share received from the issuance of common stock.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, investments, income taxes, litigation and other contingencies. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our critical accounting estimates include those regarding (1) revenue recognition, (2) goodwill, (3) intangible assets, (4) income taxes, (5) stock-based compensation and (6) business combinations. For a discussion of our critical accounting estimates, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K/A for the year ended December 31, 2020.

Recent Accounting Pronouncements

Refer to Note 2, “Recent Accounting Pronouncements,” of Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q for discussion of recent accounting pronouncements including the respective expected dates of adoption.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to financial market risks, primarily arising from the effect of interest rate fluctuations on our investment portfolio. Interest rate fluctuation may arise from changes in the market’s view of the quality of the security issuer, the overall economic outlook, and the time to maturity of our portfolio. We mitigate this risk by investing only in high quality, highly liquid instruments. Securities with original maturities of one year or less must be rated by two of the three industry standard rating agencies as follows: A1 by Standard & Poor’s, P1 by Moody’s and/or F-1 by Fitch. Securities with original maturities of greater than one year must be rated by two of the following industry standard rating agencies as follows: AA- by Standard & Poor’s, Aa3 by Moody’s and/or AA- by Fitch. By corporate investment policy, we limit the amount of exposure to $15.0 million or 10% of the portfolio, whichever is lower, for any single non-U.S. Government issuer. A single U.S. Agency can represent up to 25% of the portfolio. No more than 20% of the total portfolio may be invested in the securities of an industry sector, with money market fund investments evaluated separately. Our policy requires that at least 10% of the portfolio

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be in securities with a maturity of 90 days or less. We may make investments in U.S. Treasuries, U.S. Agencies, corporate bonds and municipal bonds and notes with maturities up to 36 months. However, the bias of our investment portfolio is shorter maturities. All investments must be U.S. dollar denominated. Additionally, we have no significant exposure to European sovereign debt.

We invest our cash equivalents and marketable securities in a variety of U.S. dollar financial instruments such as U.S. Treasuries, U.S. Government Agencies, commercial paper and corporate notes. Our policy specifically prohibits trading securities for the sole purposes of realizing trading profits. However, we may liquidate a portion of our portfolio if we experience unforeseen liquidity requirements. In such a case, if the environment has been one of rising interest rates, we may experience a realized loss, similarly, if the environment has been one of declining interest rates, we may experience a realized gain. As of June 30, 2021, we had an investment portfolio of fixed income marketable securities of $291.6 million including cash equivalents. If market interest rates were to increase immediately and uniformly by 1.0% from the levels as of June 30, 2021, the fair value of the portfolio would decline by approximately $2.1 million. Actual results may differ materially from this sensitivity analysis.

The fair value of our convertible notes is subject to interest rate risk, market risk and other factors due to the convertible feature. The fair value of the convertible notes will generally increase as interest rates fall and decrease as interest rates rise. In addition, the fair value of the convertible notes will generally increase as our common stock price increases and will generally decrease as our common stock price declines in value. The interest and market value changes affect the fair value of our convertible notes but do not impact our financial position, cash flows or results of operations due to the fixed nature of the debt obligation.

We invoice the majority of our customers in U.S. dollars. Although the fluctuation of currency exchange rates may impact our customers, and thus indirectly impact us, we do not attempt to hedge this indirect and speculative risk. Our overseas operations consist primarily of international business operations in the Netherlands and the United Kingdom, design centers in Canada, India and Finland and small business development offices in Australia, China, Japan, Korea and Taiwan. We monitor our foreign currency exposure; however, as of June 30, 2021, we believe our foreign currency exposure is not material enough to warrant foreign currency hedging.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in the reports we file or submit pursuant to the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of June 30, 2021, our disclosure controls and procedures were not effective due to a previously reported material weakness in our internal control over financial reporting.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

As previously disclosed in our Annual Report on Form 10-K/A for the year ended December 31, 2020, management concluded that we did not maintain effective internal control over financial reporting as of December 31, 2020 due to the inadequate design and maintenance of controls to evaluate and monitor the accounting for patent and technology licensing arrangements with unusual contract terms. This material weakness resulted in a material misstatement of historical consolidated financial statements and could result in a misstatement of the royalties revenue, unbilled receivables and interest income account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

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Changes in Internal Control Over Financial Reporting

We have taken remediation steps to address the material weakness discussed above to strengthen our internal control over financial reporting. These include enhancement of our existing contract review control for patent and technology licensing arrangements with unusual terms to require review of the facts as summarized in the contract review analysis by legal and the licensing group to confirm appropriate understanding of the terms by the revenue recognition team as well as implementation of a new control designed to evaluate and monitor, at inception and on a quarterly basis, the accounting assessment of patent and technology licensing arrangements with unusual terms.

However, the identified material weakness in internal control over financial reporting will not be considered remediated until controls have been in operation for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. We will continue to assess the effectiveness of our remediation efforts in connection with our evaluations of internal control over financial reporting. As we continue to evaluate and improve our internal control over financial reporting, we may take additional measures to address control deficiencies or we may modify certain of the remediation measures described above.

Other than the items described above, there have not been any changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the quarter ended June 30, 2021, that materially affected, or that we believe are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently a party to any material pending legal proceeding; however, from time to time, we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business, operating results, financial position or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management attention and resources and other factors.

Item 1A. Risk Factors

Because of the following factors, as well as other variables affecting our operating results, past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods. See also “Note Regarding Forward-Looking Statements” at the beginning of this report.

Summary Risk Factors

Our business is subject to numerous risks and uncertainties that you should consider before investing in our company, as fully described below. The principal factors and uncertainties that make investing in our company risky include, among others:

•The success of our business depends on sustaining or growing our licensing revenue and the failure to achieve such revenue would lead to a material decline in our results of operations.

•Our licensing cycle is lengthy and costly, and our marketing and licensing efforts may be unsuccessful.

•Some of our license agreements may convert to fully paid-up licenses at the expiration of their terms, or upon certain milestones, and we may not receive royalties after that time.

•Future revenue is difficult to predict for several reasons, and our failure to predict revenue accurately may result in our stock price declining.

•Our revenue is concentrated in a few customers, and if we lose any of these customers through contract terminations or acquisitions, our revenue may decrease substantially.

•Some of our revenue is subject to the pricing policies of our customers over which we have no control.

•We have traditionally operated in, and may enter other, industries that are highly cyclical and competitive.

•We face risks related to the COVID-19 pandemic, which could significantly disrupt our research and development, operations, sales and financial results.

•Our customers often require our products to undergo a lengthy and expensive qualification process which does not assure product sales. If we are unsuccessful or delayed in qualifying any of our products with a customer, our business and operating results would suffer.

•We may have to invest more resources in research and development than anticipated, which could increase our operating expenses and negatively impact our operating results.

•Our business and operations could suffer in the event of security breaches and incidents.

•Failures in our products and services or in the products of our customers, including those resulting from security vulnerabilities, defects, bugs or errors, could harm our business.

•We may fail to meet our publicly announced guidance or other expectations about our business, which would likely cause our stock price to decline.

•Changes in accounting principles and guidance could result in unfavorable accounting charges or effects.

•We have in the past made and may in the future make acquisitions or enter into mergers, strategic investments, sales of assets, divestitures or other arrangements that may not produce expected operating and financial results.

•A substantial portion of our revenue is derived from sources outside of the United States and this revenue and our business generally are subject to risks related to international operations that are often beyond our control.

•Weak global economic conditions may adversely affect demand for the products and services of our customers.

•If our counterparties are unable to fulfill their financial and other obligations to us, our business and results of operations may be affected adversely.

•If we are unable to attract and retain qualified personnel, our business and operations could suffer.

•We are subject to various government restrictions and regulations, including on the sale of products and services that use encryption technology and those related to privacy and other consumer protection matters.

•Participation in standards setting organizations may subject us to IP licensing requirements or limitations that could adversely affect our business and prospects.

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•Our operations are subject to risks of natural disasters, acts of war, terrorism, widespread illness or security breach at our domestic and international locations, any one of which could result in a business stoppage and negatively affect our operating results.

•We do not have extensive experience in manufacturing and marketing products and, as a result, may be unable to sustain and grow a profitable commercial market for new and existing products.

•We rely upon the accuracy of our customers’ recordkeeping, and any inaccuracies or payment disputes for amounts owed to us under our licensing agreements may harm our results of operations.

•We rely on a number of third-party providers for data center hosting facilities, equipment, maintenance and other services, and the loss of, or problems with, one or more of these providers may impede our growth or cause us to lose customers.

•We rely on third parties for a variety of services, including manufacturing, and these third parties’ failure to perform these services adequately or change the allocation of their services/capacity due to industry or other pressures could materially and adversely affect our business.

•Warranty, service level agreement and product liability claims brought against us could cause us to incur significant costs and adversely affect our operating results as well as our reputation and relationships with customers.

•Any failure in our delivery of high-quality technical support services may adversely affect our relationships with our customers and our financial results.

•Certain software that we use in certain of our products is licensed from third parties and, for that reason, may not be available to us in the future, which has the potential to delay product development and production or cause us to incur additional expense, which could materially adversely affect our business, financial condition, operating results and cash flow.

•Certain software we use is from open source code sources, which, under certain circumstances, may lead to unintended consequences and, therefore, could materially adversely affect our business, financial condition, operating results and cash flow.

•Our business and operating results could be harmed if we undertake any restructuring activities.

•Problems with our information systems could interfere with our business and could adversely impact our operations.

•We are leveraged financially, which could adversely affect our ability to adjust our business to respond to competitive pressures and to obtain sufficient funds to satisfy our future research and development needs, to protect and enforce our intellectual property, and to meet other needs.

•We identified a material weakness in our internal control over financial reporting and determined that our disclosure controls and procedures were ineffective as of December 31, 2020, March 31, 2021 and June 30, 2021, which resulted in a restatement of our 2020 and 2019 consolidated financial statements included in our Form 10-K for the year ended December 31, 2020 and our March 31, 2020 and June 30, 2020 condensed consolidated financial statements included in our Form 10-Q for the quarterly periods ended March 31, 2021 and June 30, 2021, respectively. The quarterly period ended September 30, 2020 will be restated in the respective 2021 Form 10-Q. In the future we may identify additional material weaknesses or otherwise fail to maintain an effective system of internal control over financial reporting or adequate disclosure controls and procedures, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.

•Adverse litigation results could affect our business.

•We have in the past, and may in the future, become engaged in litigation stemming from our efforts to protect and enforce our patents and intellectual property and make other claims, which could adversely affect our intellectual property rights, distract our management and cause substantial expenses and declines in our revenue and stock price.

•From time to time, we are subject to proceedings by government agencies that may result in adverse determinations against us and could cause our revenue to decline substantially.

•Litigation or other third-party claims of intellectual property infringement could require us to expend substantial resources and could prevent us from developing or licensing our technology on a cost-effective basis.

•If we are unable to protect our inventions successfully through the issuance and enforcement of patents, our operating results could be adversely affected.

•Our inability to protect and own the intellectual property we create would cause our business to suffer.

•Third parties may claim that our products or services infringe on their intellectual property rights, exposing us to litigation that, regardless of merit, may be costly to defend.

•Any dispute regarding our intellectual property may require us to indemnify certain customers, the cost of which could severely hamper our business operations and financial condition.

•We have been party to, and may in the future be subject to, lawsuits relating to securities law matters which may result in unfavorable outcomes and significant judgments, settlements and legal expenses which could cause our business, financial condition and results of operations to suffer.

•The price of our common stock may continue to fluctuate.

•Compliance with changing regulation of corporate governance and public disclosure may result in additional expenses.

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•Our certificate of incorporation and bylaws, Delaware law, our outstanding convertible notes and certain other agreements contain provisions that could discourage transactions resulting in a change in control, which may negatively affect the market price of our common stock.

•Unanticipated changes in our tax rates or in the tax laws, treaties and regulations could expose us to additional income tax liabilities, which could affect our operating results and financial condition.

Risks Associated With Our Business, Industry and Market Conditions

The success of our business depends on sustaining or growing our licensing revenue and the failure to achieve such revenue would lead to a material decline in our results of operations.

A significant portion of our revenue consists of patent and technology license fees paid for access to our patented technologies, existing technology and other development and support services we provide to our customers. Our ability to secure and renew the licenses from which our revenues are derived depends on our customers adopting our technology and using it in the products they sell. Once secured, license revenue may be negatively affected by factors within and outside our control, including reductions in our customers’ sales prices, sales volumes, our failure to timely complete engineering deliverables, and the actual terms of such licenses themselves. In addition, our licensing cycle for new licensees as well as for renewals for existing licensees is lengthy, costly and unpredictable. We cannot provide any assurance that we will be successful in signing new license agreements or renewing existing license agreements on equal or favorable terms or at all. If we do not achieve our revenue goals, our results of operations could decline.

Our licensing cycle is lengthy and costly, and our marketing and licensing efforts may be unsuccessful.

The process of persuading customers to adopt and license our Chip interface, data Security IP, and other technologies can be lengthy. Even if successful, there can be no assurance that our technologies will be used in a product that is ultimately brought to market, achieves commercial acceptance or results in significant royalties to us. We generally incur significant marketing and sales expenses prior to entering into our license agreements, generating a license fee and establishing a royalty stream from each customer. The length of time it takes to establish a new licensing relationship can take many months or even years. We may incur costs in any particular period before any associated revenue stream begins, if at all. If our marketing and sales efforts are very lengthy or unsuccessful, then we may face a material adverse effect on our business and results of operations as a result of failure to obtain or an undue delay in obtaining royalties.

Some of our license agreements may convert to fully paid-up licenses at the expiration of their terms, or upon certain milestones, and we may not receive royalties after that time.

From time to time, we enter into license agreements that automatically convert to fully paid-up licenses upon expiration or upon reaching certain milestones. We may not receive further royalties from customers for any licensed technology under those agreements if they convert to fully paid-up licenses because such customers will be entitled to continue using some, if not all, of the relevant intellectual property (“IP”) or technology under the terms of the license agreements without further payment, even if relevant patents or technologies are still in effect. If we cannot find another source of royalties to replace the royalties from these license agreements converting to fully paid-up licenses, our results of operations following such conversion could be adversely affected.

Future revenue is difficult to predict for several reasons, and our failure to predict revenue accurately may result in our stock price declining.

Our lengthy license negotiation cycles could make our future revenue difficult to predict because we may not be successful in entering into or renewing licenses with our customers on our anticipated timelines. As we commercially launch each of our products, the sales volume of and resulting revenue from such products in any given period will be difficult to predict.

In addition, while some of our license agreements provide for fixed, quarterly royalty payments, many of our license agreements provide for volume-based royalties and may also be subject to caps on royalties in a given period. The sales volume and prices of our customers’ products in any given period can be difficult to predict. In addition, we began applying the new revenue recognition standard (“ASC 606”) during the first quarter of 2018, as required, and we anticipate that our revenue will vary greatly from quarter to quarter. As a result of the foregoing items, our actual results may differ substantially from analyst estimates or our forecasts in any given quarter.

Also, a portion of our revenue comes from development and support services provided to our customers. Depending upon the nature of the services, a portion of the related revenue may be recognized ratably over the support period, or may be recognized according to contract revenue accounting. Contract revenue accounting may result in deferral of the service fees to the completion of the contract, or may result in the recognition of service fees over the period in which services are performed on a percentage-of-completion basis.

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Our revenue is concentrated in a few customers, and if we lose any of these customers through contract terminations or acquisitions, our revenue may decrease substantially.

We have a high degree of revenue concentration. Our top five customers for each reporting period represented approximately 56% and 51% of our revenue for the six months ended June 30, 2021 and 2020, respectively. Additionally, our top five customers represented approximately 46% and 45% of our revenues for the years ended December 31, 2020 and 2019, respectively. We expect to continue to experience significant revenue concentration for the foreseeable future.

In addition, our license agreements are complex and some contain terms that require us to provide certain customers with the lowest royalty rate that we provide to other customers for similar technologies, volumes and schedules. These clauses may limit our ability to effectively price differently among our customers, to respond quickly to market forces, or otherwise to compete on the basis of price. These clauses may also require us to reduce royalties payable by existing customers when we enter into or amend agreements with other customers. Any adjustment that reduces royalties from current customers or licensees may have a material adverse effect on our operating results and financial condition.

We continue to negotiate with customers and prospective customers to enter into license agreements. Any future agreement may trigger our obligation to offer comparable terms or modifications to agreements with our existing customers, which may be less favorable to us than the existing license terms. We expect licensing fees will continue to vary based on our success in renewing existing license agreements and adding new customers, as well as the level of variation in our customers’ reported shipment volumes, sales price and mix, offset in part by the proportion of customer payments that are fixed. In particular, under our license agreement with Samsung, the license fees payable by Samsung are subject to certain adjustments and conditions, and we therefore cannot provide assurances that the revenues generated by this license will not decline in the future. Further, the license agreement with Samsung is currently set to expire on September 30, 2023, and we cannot provide assurances that this license will be renewed. If we are unable to renew the Samsung license, then the licensing billings generated by the license will cease, and we will not recognize any revenue associated with a potential renewal. In addition, some of our material license agreements may contain rights by the customer to terminate for convenience, or upon certain other events, such as change of control, material breach, insolvency or bankruptcy proceedings. If we are unsuccessful in entering into license agreements with new customers or renewing license agreements with existing customers, on favorable terms or at all, or if they are terminated, our results of operations may decline significantly.

Some of our revenue is subject to the pricing policies of our customers over which we have no control.

We have no control over our customers’ pricing of their products and there can be no assurance that licensed products will be competitively priced or will sell in significant volumes. Any premium charged by our customers in the price of memory and controller chips or other products over alternatives must be reasonable. If the benefits of our technology do not match the price premium charged by our customers, the resulting decline in sales of products incorporating our technology could harm our operating results.

We have traditionally operated in, and may enter other, industries that are highly cyclical and competitive.

Our target customers are companies that develop and market high volume business and consumer products in semiconductors, computing, data centers, networks, tablets, handheld devices, mobile applications, gaming and graphics, high-definition televisions, cryptography and data security. The electronics industry is intensely competitive and has been impacted by rapid technological change, short product life cycles, cyclical market patterns, price erosion and increasing foreign and domestic competition. We are subject to many risks beyond our control that influence whether or not we are successful in winning target customers or retaining existing customers, including, primarily, competition in a particular industry, market acceptance of such customers’ products and the financial resources of such customers. In particular, DRAM manufacturers, which such customers make up a significant part of our revenue, are prone to significant business cycles and have suffered material losses and other adverse effects to their businesses, leading to industry consolidation from time-to-time that may result in loss of revenues under our existing license agreements or loss of target customers. As a result of ongoing competition in the industries in which we operate and volatility in various economies around the world, we may achieve a reduced number of licenses or may experience tightening of customers’ operating budgets, difficulty or inability of our customers to pay our licensing fees, lengthening of the approval process for new licenses and consolidation among our customers. All of these factors may adversely affect the demand for our technology and may cause us to experience substantial fluctuations in our operating results.

We face competition from semiconductor and digital electronics products and systems companies, and other semiconductor IP companies that provide security cores that are available to the market. We believe the principal competition for our technologies may come from our prospective customers, some of which are evaluating and developing products based on technologies that they contend or may contend will not require a license from us. Some of our competitors use a system-level design approach similar to ours, including activities such as board and package design, power and signal integrity analysis, and

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thermal management. Many of these companies are larger and may have better access to financial, technical and other resources than we possess.

To the extent that alternative technologies might provide comparable system performance at lower or similar cost to our technologies, or are perceived to require the payment of no or lower royalties, or to the extent other factors influence the industry, our customers and prospective customers may adopt and promote such alternative technologies. Even to the extent we determine that such alternative technologies infringe our patents, there can be no assurance that we would be able to negotiate agreements that would result in royalties being paid to us without litigation, which could be costly and the results of which would be uncertain.

In addition, our expansion into new markets subjects us to additional risks. We may have limited or no experience in new products and markets, and our customers may not adopt our new offerings. These and other new offerings may present new and difficult challenges, which could negatively affect our operating results.

We face risks related to the COVID-19 pandemic, which could significantly disrupt our research and development, operations, sales and financial results.

Our business may be adversely impacted by the effects of the COVID-19 pandemic. In addition to global macroeconomic effects, the COVID-19 pandemic and any other related adverse public health developments may cause disruption to our domestic and international operations and sales activities. Our third-party manufacturers, suppliers, third-party distributors, sub-contractors and customers have been and will be disrupted by worker absenteeism, quarantines and restrictions on our employees’ ability to work, office and factory closures, disruptions to ports and other shipping infrastructure, border closures, or other travel or health-related restrictions. For example, government-mandated shelter-in-place and other restrictions on movement may impact our planned headquarters relocation, the ability of our employees to perform their jobs, and our ability to develop and design our products in a timely manner or meet required milestones or customer commitments. Depending on the magnitude of such effects on the operations of our suppliers, third-party distributors, or sub-contractors, our supply chain and product shipments may be delayed, which could adversely affect our business, operations and customer relationships. In addition, the COVID-19 pandemic or other disease outbreak will in the short-run and may over the longer term adversely affect the economies and financial markets of many countries, resulting in an economic downturn that may affect demand for our products and impact our operating results. There can be no assurance that any decrease in sales resulting from the COVID-19 pandemic will be offset by increased sales in subsequent periods. In addition, the COVID-19 pandemic continues to evolve rapidly, with the status of operations and government restrictions evolving weekly. Although the magnitude of the impact of the COVID-19 pandemic on our business and operations remains uncertain, the extent to which the outbreak impacts our business, financial condition, operating results and cash flows will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the duration of the pandemic, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. We may also suffer from any of the foregoing disruptions if COVID-19 experiences a resurgence in any particular country or region in the future.

Our customers often require our products to undergo a lengthy and expensive qualification process which does not assure product sales. If we are unsuccessful or delayed in qualifying any of our products with a customer, our business and operating results would suffer.

Prior to purchasing our products, our customers often require that our products undergo extensive qualification processes, which involve testing of our products in the customers’ systems, as well as testing for reliability. This qualification process may continue for several months. However, qualification of a product by a customer does not assure any sales of the product to that customer. Even after successful qualification and sales of a product to a customer, a subsequent revision in third-party manufacturing processes may require a new qualification process with our customers, which may result in delays and in our holding excess or obsolete inventory. After our products are qualified, it can take several months or more before the customer commences volume production of components or systems that incorporate our products. Despite these uncertainties, we devote substantial resources, including design, engineering, sales, marketing and management efforts, to qualify our products with customers in anticipation of sales. If we are unsuccessful or delayed in qualifying any of our products with a customer, sales of those products to the customer may be precluded or delayed, which may impede our growth and cause our business to suffer.

We may have to invest more resources in research and development than anticipated, which could increase our operating expenses and negatively impact our operating results.

If new competitors, technological advances by existing competitors, and/or development of new technologies or other competitive factors require us to invest significantly greater resources than anticipated in our research and development efforts, our operating expenses could increase. If we are required to invest significantly greater resources than anticipated in research

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and development efforts without an increase in revenue, our operating results would decline. We expect these expenses to increase in the foreseeable future as our technology development efforts continue.

Our business and operations could suffer in the event of security breaches and incidents.

Attempts by others to gain unauthorized access to and disrupt our information technology systems are becoming more sophisticated. These attempts, which might be related to industrial or other espionage, may include covertly introducing malware to our computers and networks and impersonating authorized users, phishing attempts and other forms of social engineering, employee or contractor malfeasance, denial of service attacks and ransomware attacks, among others. We seek to detect and investigate all security incidents impacting our systems and to prevent their recurrence, but in some cases, we might be unaware of an incident or its magnitude and effects. We also utilize third-party service providers to host, transmit or otherwise process electronic data in connection with our business activities, including our supply chain processes, operations and communications. We and/or our third-party service providers have faced and may continue to face security threats and attacks from a variety of sources. Our data, corporate systems, third-party systems and security measures may be subject to breaches or intrusions due to the actions of outside parties, employee error, malfeasance, a combination of these, or otherwise, including social engineering and employee and contractor error or malfeasance, and, as a result, an unauthorized party may obtain access to our systems, networks, or data, including IP and confidential business information of ourselves and our customers. There have been and may continue to be significant supply chain attacks, and we cannot guarantee that our or our third-party service providers’ systems and networks have not been breached or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our systems and networks or the systems and networks of third parties that support us and our services. We and our service providers may face difficulties or delays in identifying or responding to any actual or perceived security breach or incident. While we have not identified any material incidents of unauthorized access to date, the theft or other unauthorized acquisition of, unauthorized use or publication of, or access to our IP and/or confidential business information could harm our competitive position and reputation, reduce the value of our investment in research and development and other strategic initiatives or otherwise adversely affect our business. To the extent that any future security breach results in inappropriate access to, or loss, corruption, acquisition or disclosure of our or our customers’ confidential information or any personally-identifiable information we or our third-party service providers maintain, including that of our employees, we could suffer a loss of intellectual property or loss of data, may be subject to claims, liability and proceedings, and may incur liability and otherwise suffer financial harm.

Any actual, alleged or perceived breach of security in our systems or networks, or any other actual, alleged or perceived data security incident we or our third-party service providers suffer, could result in damage to our reputation, negative publicity, loss of customers and sales, harm to our market position, increased costs to remedy any problems and otherwise respond to any incident, regulatory investigations and enforcement actions, claims, litigation, proceedings and other liability. In addition, we may incur significant costs and operational consequences of investigating, remediating, eliminating and putting in place additional tools and devices designed to prevent actual or perceived security breaches and other security incidents, as well as the costs to comply with any notification or other legal obligations resulting from any security incidents. Any of these negative outcomes could result in substantial costs and diversion of resources, distract management and technical personnel, adversely impact our sales and reputation and seriously harm our business or operating results.

Although we maintain insurance coverage that may cover certain liabilities in connection with some security breaches and other security incidents, we cannot be certain our insurance coverage will be adequate for liabilities actually incurred, that insurance will continue to be available to us on commercially reasonable terms (if at all) or that any insurer will not deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceed available insurance coverage, the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, or denials of coverage, could have a material adverse effect on our business, including our financial condition, results of operations and reputation.

Failures in our products and services or in the products of our customers, including those resulting from security vulnerabilities, defects, bugs or errors, could harm our business.

Our products and services are highly technical and complex, and among our various businesses our products and services are crucial to providing security and other critical functions for our customers’ operations. Our products and services have from time to time contained and may in the future contain undetected errors, bugs, defects or other security vulnerabilities. Some errors in our products and services may only be discovered after a product or service has been deployed and used by customers, and may in some cases only be detected under certain circumstances or after extended use. In addition, because the techniques used by hackers to access or sabotage our products and services and other technologies change and evolve frequently and generally are not recognized until launched against a target, we may be unable to anticipate, detect or prevent these techniques and may not address them in our data security technologies. Any errors, bugs, defects or security vulnerabilities discovered in our solutions after commercial release could adversely affect our revenue, our customer relationships and the market’s

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perception of our products and services. We may not be able to correct any errors, bugs, defects, security flaws or vulnerabilities promptly, or at all. Any breaches, defects, errors or vulnerabilities in our products and services could result in:

•expenditure of significant financial and research and development resources in efforts to analyze, correct, eliminate or work around breaches, errors, bugs or defects or to address and eliminate vulnerabilities;

•financial liability to customers for breach of certain contract provisions, including indemnification obligations;

•loss of existing or potential customers;

•product shipment restrictions or prohibitions to certain customers;

•delayed or lost revenue;

•delay or failure to attain market acceptance;

•negative publicity, which would harm our reputation; and

•litigation, regulatory inquiries or investigations that would be costly and harm our reputation.

We may fail to meet our publicly announced guidance or other expectations about our business, which would likely cause our stock price to decline.

We provide guidance regarding our expected financial and business performance including our anticipated future revenues, operating expenses and other financial and operation metrics. We enhanced our guidance following implementation of Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers in Accounting Standards Codification (“ASC”) Topic 606 (“ASC 606”, “the New Revenue Standard”) in the first quarter of 2018. Correctly identifying the key factors affecting business conditions and predicting future events is an inherently uncertain process. Any guidance that we provide may not always be accurate, or may vary from actual results, due to our inability to correctly identify and quantify risks and uncertainties to our business and to quantify their impact on our financial performance. We offer no assurance that such guidance will ultimately be accurate, and investors should treat any such guidance with appropriate caution. If we fail to meet our guidance or if we find it necessary to revise such guidance, even if such failure or revision is seemingly insignificant, investors and analysts may lose confidence in us and the market value of our common stock could be materially adversely affected.

Changes in accounting principles and guidance could result in unfavorable accounting charges or effects.

We prepare our financial statements in accordance with accounting principles generally accepted in the United States and these principles are subject to interpretation by the SEC and various bodies. A change in these principles or application guidance, or in their interpretations, may have a material effect on our reported results, as well as our processes and related controls, and may retroactively affect previously reported results. For instance, we adopted ASC 842, the New Leasing Standard, effective for us on January 1, 2019, using the alternative transition method and recognized a cumulative-effect adjustment to the opening balance of accumulated deficit on January 1, 2019. We also adopted ASC 606, the New Revenue Standard, effective for us on January 1, 2018, on a modified retrospective basis, with a cumulative-effect adjustment to the opening balance of accumulated deficit on January 1, 2018. The New Revenue Standard materially impacted the timing of revenue recognition for our fixed-fee IP licensing arrangements (including certain fixed-fee agreements that license our existing IP portfolio as well as IP added to our portfolio during the license term) as a majority of such revenue would be recognized at inception of the license term (as opposed to over time as is the case under prior U.S. GAAP), and we are required to compute and recognize interest income over time for certain licensing arrangements as control over the IP generally transfers significantly in advance of cash being received from customers. The impact of the adoption of the New Revenue Standard did not have a material impact on our other revenue streams. We also have enhanced the form and content of some of our guidance metrics that we provide following implementation of the New Revenue Standard. We expect that any change to current revenue recognition practices may significantly increase volatility in our quarterly revenue, financial results and trends, and may impact our stock price.

We have in the past made and may in the future make acquisitions or enter into mergers, strategic investments, sales of assets, divestitures or other arrangements that may not produce expected operating and financial results.

From time to time, we engage in acquisitions, strategic transactions, strategic investments, divestitures and potential discussions with respect thereto. For example, in 2019, we acquired Northwest Logic and the Secure Silicon IP and Protocols business from Verimatrix, formerly Inside Secure. Further, in June 2021, we announced that we had entered into agreements to acquire AnalogX Inc. (“AnalogX”) and PLDA Group (“PLDA”). We acquired AnalogX in July 2021 and the transaction with PLDA, which is subject to customary closing conditions and approvals, is expected to close in the third quarter of 2021. Many of our acquisitions or strategic investments entail a high degree of risk, including those involving new areas of technology and such investments may not become liquid for several years after the date of the investment, if at all. Our acquisitions or strategic investments may not provide the advantages that we anticipated or generate the financial returns we expect, including if we are

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unable to close any pending acquisitions. For example, for any pending or completed acquisitions, we may discover unidentified issues not discovered in due diligence, and we may be subject to regulatory approvals or liabilities that are not covered by indemnification protection or become subject to litigation.

Achieving the anticipated benefits of business acquisitions depends in part upon our ability to integrate the acquired businesses in an efficient and effective manner and achieve anticipated synergies, and we may not be successful in these efforts. The integration of companies that have previously operated independently is complex and time consuming and may result in significant challenges, including, among others: retaining key employees; successfully integrating new employees, facilities, products, processes, operations, business models and systems, technology, and sales and distribution channels; retaining customers and suppliers of the acquired business; minimizing the diversion of management’s and other employees’ attention from ongoing business matters; coordinating geographically separate organizations; consolidating research and development operations; consolidating corporate and administrative infrastructures; and managing the increased scale, complexity and globalization of our business, operations and employee base. We do not currently foresee any significant risks in the operational integration of either AnalogX or PLDA.

Our strategic investments in new areas of technology may involve significant risks and uncertainties, including distraction of management from current operations, greater than expected liabilities and expenses, inadequate return of capital, and unidentified issues not discovered in due diligence. These investments are inherently risky and may not be successful.

In addition, we may record impairment charges related to our acquisitions or strategic investments. Any losses or impairment charges that we incur related to acquisitions, strategic investments or sales of assets will have a negative impact on our financial results and the market value of our common stock, and we may continue to incur new or additional losses related to acquisitions or strategic investments.

We may have to incur debt or issue equity securities to pay for any future acquisitions, which debt could involve restrictive covenants or which equity security issuance could be dilutive to our existing stockholders. We may also use cash to pay for any future acquisitions which will reduce our cash balance.

From time to time, we may also divest certain assets. These divestitures or proposed divestitures may involve the loss of revenue and/or potential customers, and the market for the associated assets may dictate that we sell such assets for less than what we paid. In addition, in connection with any asset sales or divestitures, we may be required to provide certain representations, warranties and covenants to buyers. While we would seek to ensure the accuracy of such representations and warranties and fulfillment of any ongoing obligations, we may not be completely successful and consequently may be subject to claims by a purchaser of such assets.

A substantial portion of our revenue is derived from sources outside of the United States and this revenue and our business generally are subject to risks related to international operations that are often beyond our control.

For the six months ended June 30, 2021 and 2020, revenues received from our international customers constituted approximately 41% and 48%, respectively, of our total revenue. Additionally, for the years ended December 31, 2020 and 2019, revenues received from our international customers constituted approximately 44% and 41%, respectively, of our total revenue. We expect that future revenue derived from international sources will continue to represent a significant portion of our total revenue.

To the extent that customer sales are not denominated in U.S. dollars, any royalties which are based on a percentage of the customers’ sales that we receive as a result of such sales could be subject to fluctuations in currency exchange rates. In addition, if the effective price of licensed products sold by our foreign customers were to increase as a result of fluctuations in the exchange rate of the relevant currencies, demand for licensed products could fall, which in turn would reduce our royalties. We do not use financial instruments to hedge foreign exchange rate risk.

Trade-related government actions, whether implemented by the U.S. government, China or other countries, that impose barriers or restrictions that would impact our ability to sell or ship products to certain customers may have a negative impact on our financial condition and results of operations. We cannot predict the actions government entities may take in this context and may be unable to quickly offset or effectively react to government actions that restrict our ability to sell to certain customers or in certain jurisdictions. Government actions that affect our customers’ ability to sell products or access critical elements of their supply chains may result in a decreased demand for their products, which may consequently reduce their demand for our products.

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We currently have international business operations in the United Kingdom, France and the Netherlands, international design operations in Canada, India and Finland, and business development operations in China, Japan, Korea, and Taiwan. Our international operations and revenue are subject to a variety of risks which are beyond our control, including:

•hiring, maintaining and managing a workforce and facilities remotely and under various legal systems, including compliance with local labor and employment laws;

•non-compliance with our code of conduct or other corporate policies;

•natural disasters, acts of war, terrorism, widespread global pandemics or illness, such as the current Novel Coronavirus (COVID-19), or security breaches;

•export controls, tariffs, import and licensing restrictions and other trade barriers;

•profits, if any, earned abroad being subject to local tax laws and not being repatriated to the United States or, if repatriation is possible, limited in amount;

•adverse tax treatment of revenue from international sources and changes to tax codes, including being subject to foreign tax laws and being liable for paying withholding, income or other taxes in foreign jurisdictions;

•unanticipated changes in foreign government laws and regulations;

•increased financial accounting and reporting burdens and complexities;

•lack of protection of our IP and other contract rights by jurisdictions in which we may do business to the same extent as the laws of the United States;

•potential vulnerability to computer system, internet or other systemic attacks, such as denial of service, viruses or other malware which may be caused by criminals, terrorists or other sophisticated organizations;

•social, political and economic instability;

•geopolitical issues, including changes in diplomatic and trade relationships, in particular with China; and

•cultural differences in the conduct of business both with customers and in conducting business in our international facilities and international sales offices.

We and our customers are subject to many of the risks described above with respect to companies which are located in different countries. There can be no assurance that one or more of the risks associated with our international operations will not result in a material adverse effect on our business, financial condition or results of operations.

Weak global economic conditions may adversely affect demand for the products and services of our customers.

Our operations and performance depend significantly on worldwide economic conditions. Future uncertainty about global or regional economic and political conditions poses a risk as consumers and businesses may postpone spending in response to tighter credit, negative financial news and declines in income or asset values, which could have a material negative effect on the demand for the products of our customers in the foreseeable future. If our customers experience reduced demand for their products as a result of global or regional economic conditions or otherwise, this could result in reduced royalty revenue and our business and results of operations could be harmed.

If our counterparties are unable to fulfill their financial and other obligations to us, our business and results of operations may be affected adversely.

Any downturn in economic conditions or other business factors could threaten the financial health of our counterparties, including companies with which we have entered into licensing and/or settlement agreements, and their ability to fulfill their financial and other obligations to us. Such financial pressures on our counterparties may eventually lead to bankruptcy proceedings or other attempts to avoid financial obligations that are due to us. Because bankruptcy courts have the power to modify or cancel contracts of the petitioner which remain subject to future performance and alter or discharge payment obligations related to pre-petition debts, we may receive less than all of the payments that we would otherwise be entitled to receive from any such counterparty as a result of bankruptcy proceedings.

If we are unable to attract and retain qualified personnel, our business and operations could suffer.

Our success is dependent upon our ability to identify, attract, compensate, motivate and retain qualified personnel, especially engineers, senior management and other key personnel. The loss of the services of any key employees could be disruptive to our development efforts, business relationships and strategy, and could cause our business and operations to suffer.

Recently, we have experienced significant changes in our management team, including in the role of chief executive officer and other senior executives. Our future success depends in large part upon the continued service and enhancement of our management team and our employees. If there are further changes in management, such changes could be disruptive and could negatively affect our sales, operations, culture, future recruiting efforts and strategic direction. Competition for qualified

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executives is intense and if we are unable to compensate our key talent appropriately and continue expanding our management team, or successfully integrate new additions to our management team in a manner that enables us to scale our business and operations effectively, our ability to operate effectively and efficiently could be limited or negatively impacted. In addition, changes in key management positions may temporarily affect our financial performance and results of operations as new management becomes familiar with our business, processes and strategy. The loss of any of our key personnel, or our inability to attract, integrate and retain qualified employees, could require us to dedicate significant financial and other resources to such personnel matters, disrupt our operations and seriously harm our operations and business.

We are subject to various government restrictions and regulations, including on the sale of products and services that use encryption technology and those related to privacy and other consumer protection matters.

Various countries have adopted controls, license requirements and restrictions on the export, import and use of products or services that contain encryption technology. In addition, governmental agencies have proposed additional requirements for encryption technology, such as requiring the escrow and governmental recovery of private encryption keys. Restrictions on the sale or distribution of products or services containing encryption technology may impact our ability to license data security technologies to the manufacturers and providers of such products and services in certain markets or may require us or our customers to make changes to the licensed data security technology that is embedded in such products to comply with such restrictions. Government restrictions, or changes to the products or services our customers to comply with such restrictions, could delay or prevent the acceptance and use of such customers’ products and services. In addition, the United States and other countries have imposed export controls that prohibit the export of encryption technology to certain countries, entities and individuals. Our failure to comply with export and use regulations concerning encryption technology could subject us to sanctions and penalties, including fines, and suspension or revocation of export or import privileges.

We are subject to a variety of laws and regulations in the United States, the European Union and other countries that involve, for example, user privacy, data protection and security, content and consumer protection. A number of proposals are pending before federal, state, and foreign legislative and regulatory bodies that could significantly affect our business. For example, in 2016, a new EU data protection regime, the General Data Protection Regulation (“GDPR”) was adopted, with it fully effective on May 25, 2018, and California enacted the California Consumer Privacy Act as of January 1, 2020 (“CCPA”). Moreover, a new privacy law, the California Privacy Rights Act (“CPRA”), was approved by California voters in November 2020. The CPRA significantly modifies the CCPA when it becomes effective in most material respects on January 1, 2023. Further, on March 2, 2021, Virginia enacted the Virginia Consumer Data Protection Act (“CDPA”), a comprehensive privacy statute that shares similarities with the CCPA, CPRA and legislation proposed in other states. The GDPR and CCPA, and new and evolving laws such as the CPRA, CDPA and other future changes in laws or regulations relating to privacy, data protection and information security may require us to modify our existing practices with respect to the collection, use and disclosure of data. In particular, the GDPR provides for significant penalties in the case of non-compliance of up to €20 million or four percent of worldwide annual revenues, whichever is greater. The GDPR, CCPA, CPRA, CDPA and other existing and proposed laws and regulations can be costly to comply with and can delay or impede the development of new products, result in negative publicity, increase our operating costs and subject us to claims or other remedies.

In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC established new disclosure and reporting requirements for those companies that use “conflict” minerals mined from the Democratic Republic of Congo and adjoining countries in their products, whether or not these products are manufactured by third parties. These requirements could affect the sourcing and availability of minerals that are used in the manufacture of our products. We have to date incurred costs and expect to incur significant additional costs associated with complying with the disclosure requirements, including for example, due diligence in regard to the sources of any conflict minerals used in our products, in addition to the cost of remediation and other changes to products, processes, or sources of supply as a consequence of such verification activities. Additionally, we may face reputational challenges with our customers and other stakeholders if we are unable to sufficiently verify the origins of all minerals used in our products through the due diligence procedures that we implement. We may also face challenges with government regulators and our customers and suppliers if we are unable to sufficiently verify that the metals used in our products are conflict free.

Participation in standards setting organizations may subject us to IP licensing requirements or limitations that could adversely affect our business and prospects.

In the course of our participation in the development of emerging standards for some of our present and future products, we may be obligated to grant to all other participants a license to our patents that are essential to the practice of those standards on reasonable and non-discriminatory, or RAND, terms. If we fail to limit to whom we license our patents, or fail to limit the terms of any such licenses, we may be required to license our patents or other IP to others in the future, which could limit the effectiveness of our patents against competitors.

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Our operations are subject to risks of natural disasters, acts of war, terrorism, widespread illness or security breach at our domestic and international locations, any one of which could result in a business stoppage and negatively affect our operating results.

Our business operations depend on our ability to maintain and protect our facilities, computer systems and personnel, which are primarily located in the San Francisco Bay Area in the United States, Canada, the Netherlands and India. The San Francisco Bay Area is in close proximity to known earthquake fault zones. Our facilities and transportation for our employees are susceptible to damage from earthquakes and other natural disasters such as fires, floods and similar events. Should a catastrophe disable our facilities, we do not have readily available alternative facilities from which we could conduct our business, so any resultant work stoppage could have a negative effect on our operating results. We also rely on our network infrastructure and technology systems for operational support and business activities which are subject to physical and cyber damage, and also susceptible to other related vulnerabilities common to networks and computer systems. Acts of terrorism, widespread illness, or global pandemics, including the current Novel Coronavirus (COVID-19) pandemic, war and any event that causes failures or interruption in our network infrastructure and technology systems could have a negative effect at our international and domestic facilities and could harm our business, financial condition, and operating results.

We do not have extensive experience in manufacturing and marketing products and, as a result, may be unable to sustain and grow a profitable commercial market for new and existing products.

We do not have extensive experience in creating, manufacturing and marketing products. Our product offerings may present new and difficult challenges, and we may be subject to claims if customers of our offerings experience delays, failures, non-performance or other quality issues. In particular, we may experience difficulties with product design, qualification, manufacturing, marketing or certification that could delay or prevent our development, introduction or marketing and sales of products. Although we intend to design our products to be fully compliant with applicable industry standards, proprietary enhancements may not in the future result in full conformance with existing industry standards under all circumstances.

If we fail to introduce products that meet the demand of our customers, penetrate new markets in which we expend significant resources, or our marketing and sales cycles that we experience are longer than we anticipate, our revenues will be difficult to predict, may decrease over time and our financial condition could suffer. Additionally, if we concentrate resources on a new market that does not prove profitable or sustainable, it could damage our reputation and limit our growth, and our financial condition could decline.

Further, our business model continues to transform towards greater reliance on product revenue and has recently placed increased reliance on sales of our memory interface chips towards that end. In particular, we are relying on our memory interface chips to result in significant growth in the third and fourth quarters of 2021. If sales of our memory interface chips do not grow as anticipated during the aforementioned time period or if we are unable to execute on that business transformation, then our business could suffer as a result.

We rely upon the accuracy of our customers’ recordkeeping, and any inaccuracies or payment disputes for amounts owed to us under our licensing agreements may harm our results of operations.

Many of our license agreements require our customers to document the manufacture and sale of products that incorporate our technology and report this data to us on a quarterly basis. While licenses with such terms give us the right to audit books and records of our customers to verify this information, audits rarely are undertaken because they can be expensive, time consuming, and potentially detrimental to our ongoing business relationship with our customers. Therefore, we typically rely on the accuracy of the reports from customers without independently verifying the information in them. Our failure to audit our customers’ books and records may result in our receiving more or less royalty revenue than we are entitled to under the terms of our license agreements. If we conduct royalty audits in the future, such audits may trigger disagreements over contract terms with our customers and such disagreements could hamper customer relations, divert the efforts and attention of our management from normal operations and impact our business operations and financial condition.

We are subject to increased inventory risks and costs because we build our products based on forecasts provided by customers before receiving purchase orders for the product.

We rely on a number of third-party providers for data center hosting facilities, equipment, maintenance and other services, and the loss of, or problems with, one or more of these providers may impede our growth or cause us to lose customers.

We rely on third-party providers to supply data center hosting facilities, equipment, maintenance and other services in order to enable us to provide some of our services, and have entered into various agreements for such services. The continuous availability of our services depends on the operations of those facilities, on a variety of network service providers and on third-party vendors. In addition, we depend on our third-party facility providers’ ability to protect these facilities against damage or interruption from natural disasters, power or telecommunications failures, criminal acts, cyber-attacks and similar events. If

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there are any lapses of service or damage to a facility, we could experience lengthy interruptions in our service as well as delays and additional expenses in arranging new facilities and services. Even with current and planned disaster recovery arrangements, our business could be harmed. Any interruptions or delays in our service, whether as a result of third-party error, our own error, natural disasters, criminal acts, security breaches or other causes, whether accidental or willful, could harm our relationships with customers, harm our reputation and cause our revenue to decrease and/or our expenses to increase. Also, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur. These factors in turn could further reduce our revenue, subject us to liability and cause us to issue credits or cause us to lose customers, any of which could materially adversely affect our business.

We rely on third parties for a variety of services, including manufacturing, and these third parties’ failure to perform these services adequately or change the allocation of their services/capacity due to industry or other pressures could materially and adversely affect our business.

We rely on third parties for a variety of services, including our manufacturing supply chain partners and third parties within our sales and distribution channels. Certain of these third parties are, and may be, our sole manufacturer or sole source of certain production materials. If we fail to manage our relationships with these manufacturers and suppliers effectively, or if they experience delays, disruptions, capacity constraints/allocation pressures or quality control problems in their operations, our ability to ship products to our customers could be impaired and our competitive position and reputation could be harmed. In addition, any adverse change in any of our manufacturers and suppliers’ financial or business condition could disrupt our ability to supply quality products to our customers. If we are required to change our manufacturers, we may lose revenue, incur increased costs and damage our end-customer relationships. In addition, qualifying a new manufacturer and commencing production can be an expensive and lengthy process. If our third-party manufacturers or suppliers are unable to provide us with adequate supplies of high-quality products for any other reason, we could experience a delay in our order fulfillment, and our business, operating results and financial condition would be adversely affected. In the event these and other third parties we rely on fail to provide their services adequately, including as a result of errors in their systems, industry pressures or events beyond their control, or refuse to provide these services on terms acceptable to us or at all, and we are not able to find suitable alternatives, our business may be materially and adversely affected. In addition, our orders may represent a relatively small percentage of the overall orders received by our manufacturers from their customers. As a result, fulfilling our orders may not be considered a priority in the event our manufacturers are constrained in their ability to fulfill all of their customer obligations in a timely manner. If our manufacturers are unable to provide us with adequate supplies of high-quality products, or if we or our manufacturers are unable to obtain adequate quantities of components, it could cause a delay in our order fulfillment, in which case our business, operating results and financial condition could be adversely affected.

Semiconductor supply chain disruptions have been well publicized over the past year given high demand and lower supply. We believe that we could experience various supply constraints related to our memory interface chip business in the near term. While we continually work with our suppliers to mitigate the impact of the supply constraints to our customer deliveries, in the event of a shortage or supply interruption from suppliers of related components, we may not be able to develop alternate sources quickly, cost-effectively, or at all. Additionally, various sources of supply-chain risk, including strikes or shutdowns at delivery ports or loss of or damage to our products while they are in transit or storage, intellectual property theft, losses due to tampering, third-party vendor issues with quality or sourcing control, failure by our suppliers to comply with applicable laws and regulations, potential tariffs or other trade restrictions, or other similar problems could limit or delay the supply of our products or harm our reputation. Any interruption or delay in manufacturing or component supply, any increases in manufacturing or component costs, or the inability to obtain these services or components from alternate sources at acceptable prices and within a reasonable amount of time would harm our ability to provide our products to customers on a timely basis. This could harm our relationships with our customers, prevent us from acquiring new customers, and materially and adversely affect our business.

Warranty, service level agreement and product liability claims brought against us could cause us to incur significant costs and adversely affect our operating results as well as our reputation and relationships with customers.

We may from time to time be subject to warranty, service level agreement and product liability claims with regard to product performance and our services. We could incur material losses as a result of warranty, support, repair or replacement costs in response to customer complaints or in connection with the resolution of contemplated or actual legal proceedings relating to such claims. In addition to potential losses arising from claims and related legal proceedings, warranty and product liability claims could affect our reputation and our relationship with customers. We generally attempt to limit the maximum amount of indemnification or liability that we could be exposed to under our contracts, however, this is not always possible.

Any failure in our delivery of high-quality technical support services may adversely affect our relationships with our customers and our financial results.

Our customers depend on our support organization to resolve technical issues and provide ongoing maintenance relating to our products and services. We may be unable to respond quickly enough to accommodate short-term increases in customer

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demand for support services. Increased customer demand for these services, without corresponding revenues, could increase costs and adversely affect our operating results. In addition, our sales process is highly dependent on our offerings and business reputation and on positive recommendations from our existing customers. Any failure to maintain high-quality technical support, or a market perception that we do not maintain high-quality support, could adversely affect our reputation, our ability to sell our solutions to existing and prospective customers, and our business, operating results and financial position.

Certain software that we use in certain of our products is licensed from third parties and, for that reason, may not be available to us in the future, which has the potential to delay product development and production or cause us to incur additional expense, which could materially adversely affect our business, financial condition, operating results and cash flow.

Some of our products and services contain software licensed from third parties. Some of these licenses may not be available to us in the future on terms that are acceptable to us or allow our products to remain competitive. The loss of these licenses or the inability to maintain any of them on commercially acceptable terms could delay development of future offerings or the enhancement of existing products and services. We may also choose to pay a premium price for such a license in certain circumstances where continuity of the licensed product would outweigh the premium cost of the license. The unavailability of these licenses or the necessity of agreeing to commercially unreasonable terms for such licenses could materially adversely affect our business, financial condition, operating results and cash flow.

Certain software we use is from open source code sources, which, under certain circumstances, may lead to unintended consequences and, therefore, could materially adversely affect our business, financial condition, operating results and cash flow.

We use open source software in our services and we intend to continue to use open source software in the future. From time to time, there have been claims challenging the ownership of open source software against companies that incorporate open source software into their products or alleging that these companies have violated the terms of an open source license. As a result, we could be subject to lawsuits by parties claiming ownership of what we believe to be open source software or alleging that we have violated the terms of an open source license. Litigation could be costly for us to defend, have a negative effect on our operating results and financial condition or require us to devote additional research and development resources to change our solutions. In addition, if we were to combine our proprietary software solutions with open source software in certain manners, we could, under certain open source licenses, be required to publicly release the source code of our proprietary software solutions. If we inappropriately use open source software, we may be required to re-engineer our solutions, discontinue the sale of our solutions, release the source code of our proprietary software to the public at no cost or take other remedial actions. There is a risk that open source licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to commercialize our solutions, which could adversely affect our business, operating results and financial condition.

Our business and operating results could be harmed if we undertake any restructuring activities.

From time to time, we may undertake restructurings of our business, including discontinuing certain products, services and technologies and planned reductions in force. There are several factors that could cause restructurings to have adverse effects on our business, financial condition and results of operations. These include potential disruption of our operations, the development of our technology, the deliveries to our customers and other aspects of our business. Loss of sales, service and engineering talent, in particular, could damage our business. Any restructuring would require substantial management time and attention and may divert management from other important work. Employee reductions or other restructuring activities also would cause us to incur restructuring and related expenses such as severance expenses. Moreover, we could encounter delays in executing any restructuring plans, which could cause further disruption and additional unanticipated expense.

Problems with our information systems could interfere with our business and could adversely impact our operations.

We rely on our information systems and those of third parties for fulfilling licensing and contractual obligations, processing customer orders, delivering products, providing services and support to our customers, billing and tracking our customer orders, performing accounting operations and otherwise running our business. If our systems fail, our disaster and data recovery planning and capacity may prove insufficient to enable timely recovery of important functions and business records. Any disruption in our information systems and those of the third parties upon whom we rely could have a significant impact on our business. Additionally, our information systems may not support new business models and initiatives and significant investments could be required in order to upgrade them. Delays in adapting our information systems to address new business models and accounting standards could limit the success or result in the failure of such initiatives and impair the effectiveness of our internal controls. Even if we do not encounter these adverse effects, the implementation of these enhancements may be much more costly than we anticipated. If we are unable to successfully implement the information systems enhancements as planned, our operating results could be negatively impacted.

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We are leveraged financially, which could adversely affect our ability to adjust our business to respond to competitive pressures and to obtain sufficient funds to satisfy our future research and development needs, to protect and enforce our intellectual property, and to meet other needs.

We have material indebtedness. In November 2017, we issued $172.5 million aggregate principal amount of our 2023 Notes, the entire amount of which remains outstanding. The degree to which we are leveraged could have negative consequences, including, but not limited to, the following:

•we may be more vulnerable to economic downturns, less able to withstand competitive pressures and less flexible in responding to changing business and economic conditions;

•our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, litigation, general corporate or other purposes may be limited;

•a substantial portion of our cash flows from operations in the future may be required for the payment of interest and principal when due at maturity in February 2023; and

•we may be required to make cash payments upon any conversion of the 2023 Notes, which would reduce our cash on hand.

A failure to comply with the covenants and other provisions of our debt instruments could result in events of default under such instruments, which could permit acceleration of all of our outstanding 2023 Notes. Any required repurchase of the 2023 Notes as a result of a fundamental change or acceleration of the 2023 Notes would reduce our cash on hand such that we would not have those funds available for use in our business.

If we are at any time unable to generate sufficient cash flows from operations to service our indebtedness when payment is due, we may be required to attempt to renegotiate the terms of the instruments relating to the indebtedness, seek to refinance all or a portion of the indebtedness or obtain additional financing. There can be no assurance that we will be able to successfully renegotiate such terms, that any such refinancing would be possible or that any additional financing could be obtained on terms that are favorable or acceptable to us.

We identified a material weakness in our internal control over financial reporting and determined that our disclosure controls and procedures were ineffective as of December 31, 2020, March 31, 2021 and June 30, 2021, which resulted in a restatement of our 2020 and 2019 consolidated financial statements included in our Form 10-K for the year ended December 31, 2020 and our March 31, 2020 and June 30, 2020 condensed consolidated financial statements included in our Form 10-Q for the quarterly periods ended March 31, 2021 and June 30, 2021, respectively. The quarterly period ended September 30, 2020 will be restated in the respective 2021 Form 10-Q. In the future we may identify additional material weaknesses or otherwise fail to maintain an effective system of internal control over financial reporting or adequate disclosure controls and procedures, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an assessment of the effectiveness of our internal control over financial reporting and our disclosure controls and procedures as of December 31, 2020. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. In Management’s Report on Internal Control over Financial Reporting included in our Original Form 10-K for the year ended December 31, 2020, our management initially concluded that we maintained effective internal control over financial reporting as of December 31, 2020. Our management subsequently concluded that a material weakness existed and our disclosure controls and procedures were not effective as of December 31, 2020. During the quarter ending March 31, 2021, we determined that a portion of revenue under a single customer agreement that had not yet been recognized should have been recognized beginning in the third quarter of 2019. As a result, we determined that a material misstatement of the financial statements had occurred, which required a restatement of the 2019 and 2020 financial statements included in our Form 10-K for the year ended December 31, 2020 and our Form 10-Qs for the quarterly periods ended September 30, 2019 through September 30, 2020. This was due to the inadequate design and maintenance of controls to evaluate and monitor the accounting for patent and technology licensing contracts with unusual contract terms. Additionally, this control deficiency could result in a misstatement of the revenue, unbilled receivables and interest income account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected. Accordingly, management determined that this control deficiency constituted a material weakness, and as a result, management concluded that, as of December 31, 2020, our internal control over financial reporting were not effective based on the criteria in Internal Control — Integrated Framework (2013) issued by the COSO, and our disclosure controls and procedures were not effective. Management subsequently restated its determinations related to our internal control over financial reporting and disclosure controls and procedures as of December 31, 2020 to reflect that both were ineffective.

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Management is actively engaged in the planning for, and implementation of, remediation efforts to address our material weakness and improve our internal control over financial reporting and disclosure controls and procedures. The remediation plan includes enhancement of our existing contract review control for revenue arrangements with unusual terms to require review of the facts as summarized in the contract review analysis by legal and the licensing group to confirm appropriate understanding of the terms by the revenue recognition team, as well as implementation of a new control designed to evaluate and monitor, at inception and on a quarterly basis, the accounting assessment of revenue contracts with unusual terms. If we are not successful in our remediation efforts and do not improve our internal control over financial reporting and disclosure controls and procedures, we may have future material misstatements in our periodic reports, which could lead to the discovery of additional material weaknesses, require restatement of our previously filed financial statements, cause us to fail to meet our reporting obligations and adversely impact our results of operations. Additionally, a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If we are not able to comply with the requirements of the Sarbanes-Oxley Act or if we are unable to maintain effective internal control over financial reporting and disclosure controls and procedures, we may not be able to produce timely and accurate financial statements or guarantee that information required to be disclosed by us in the reports that we file with the SEC, is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms. Any failure of our internal control over financial reporting or disclosure controls and procedures could cause our investors to lose confidence in our publicly reported information, cause the market price of our stock to decline, expose us to sanctions or investigations by the SEC or other regulatory authorities, or impact our results of operations.

Risks Associated with Litigation, Regulation and Our Intellectual Property

Adverse litigation results could affect our business.

We may be subject to legal claims or regulatory matters involving consumer, stockholder, employment, competition, IP and other issues on a global basis. Litigation can be lengthy, expensive and disruptive to our operations, and results cannot be predicted with certainty. An adverse decision could include monetary damages or, in cases for which injunctive relief is sought, an injunction prohibiting us from manufacturing or selling one or more of our products or technologies. If we were to receive an unfavorable ruling on a matter, our business, operating results or financial condition could be materially harmed.

We have in the past, and may in the future, become engaged in litigation stemming from our efforts to protect and enforce our patents and intellectual property and make other claims, which could adversely affect our intellectual property rights, distract our management and cause substantial expenses and declines in our revenue and stock price.

We seek to diligently protect our IP rights and will continue to do so. While we are not currently involved in IP litigation, any future litigation, whether or not determined in our favor or settled by us, would be expected to be costly, may cause delays applicable to our business (including delays in negotiating licenses with other actual or potential customers), would be expected to discourage future design partners, would tend to impair adoption of our existing technologies and would divert the efforts and attention of our management and technical personnel from other business operations. In addition, we may be unsuccessful in any litigation if we have difficulty obtaining the cooperation of former employees and agents who were involved in our business during the relevant periods related to our litigation and are now needed to assist in cases or testify on our behalf. Furthermore, any adverse determination or other resolution in litigation could result in our losing certain rights beyond the rights at issue in a particular case, including, among other things: our being effectively barred from suing others for violating certain or all of our IP rights; our patents being held invalid or unenforceable or not infringed; our being subjected to significant liabilities; our being required to seek licenses from third parties; our being prevented from licensing our patented technology; or our being required to renegotiate with current customers on a temporary or permanent basis.

From time to time, we are subject to proceedings by government agencies that may result in adverse determinations against us and could cause our revenue to decline substantially.

An adverse resolution by or with a governmental agency could result in severe limitations on our ability to protect and license our IP, and could cause our revenue to decline substantially. Third parties have and may attempt to use adverse findings by a government agency to limit our ability to enforce or license our patents in private litigations, to challenge or otherwise act against us with respect to such government agency proceedings.

Further, third parties have sought and may seek review and reconsideration of the patentability of inventions claimed in certain of our patents by the U.S. Patent and Trademark Office (“USPTO”) and/or the European Patent Office (the “EPO”). Any re-examination or inter parties review proceedings may be initiated by the USPTO’s Patent Trial and Appeal Board (“PTAB”). The PTAB and the related former Board of Patent Appeals and Interferences have previously issued decisions in a few cases, finding some challenged claims of Rambus’ patents to be valid, and others to be invalid. Decisions of the PTAB are

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subject to further USPTO proceedings and/or appeal to the Court of Appeals for the Federal Circuit. A final adverse decision, not subject to further review and/or appeal, could invalidate some or all of the challenged patent claims and could also result in additional adverse consequences affecting other related U.S. or European patents, including in any IP litigation. If a sufficient number of such patents are impaired, our ability to enforce or license our IP would be significantly weakened and could cause our revenue to decline substantially.

The pendency of any governmental agency acting as described above may impair our ability to enforce or license our patents or collect royalties from existing or potential customers, as any litigation opponents may attempt to use such proceedings to delay or otherwise impair any pending cases and our existing or potential customers may await the final outcome of any proceedings before agreeing to new licenses or to paying royalties.

Litigation or other third-party claims of intellectual property infringement could require us to expend substantial resources and could prevent us from developing or licensing our technology on a cost-effective basis.

Our research and development programs are in highly competitive fields in which numerous third parties have issued patents and patent applications with claims closely related to the subject matter of our programs. We have also been named in the past, and may in the future be named, as a defendant in lawsuits claiming that our technology infringes upon the IP rights of third parties. As we develop additional products and technology, we may face claims of infringement of various patents and other IP rights by third parties. In the event of a third-party claim or a successful infringement action against us, we may be required to pay substantial damages, to stop developing and licensing our infringing technology, to develop non-infringing technology, and to obtain licenses, which could result in our paying substantial royalties or our granting of cross licenses to our technologies. We may not be able to obtain licenses from other parties at a reasonable cost, or at all, which could cause us to expend substantial resources, or result in delays in, or the cancellation of, new products. Moreover, customers and/or suppliers of our products may seek indemnification for alleged infringement of IP rights. We could be liable for direct and consequential damages and expenses including attorneys’ fees. A future obligation to indemnify our customers and/or suppliers may harm our business, financial condition and operating results.

If we are unable to protect our inventions successfully through the issuance and enforcement of patents, our operating results could be adversely affected.

We have an active program to protect our proprietary inventions through the filing of patents. There can be no assurance, however, that:

•any current or future U.S. or foreign patent applications will be approved and not be challenged by third parties;

•our issued patents will protect our IP and not be challenged by third parties;

•the validity of our patents will be upheld;

•our patents will not be declared unenforceable;

•the patents of others will not have an adverse effect on our ability to do business;

•Congress or the U.S. courts or foreign countries will not change the nature or scope of rights afforded patents or patent owners or alter in an adverse way the process for seeking or enforcing patents;

•changes in law will not be implemented, or changes in interpretation of such laws will occur, that will affect our ability to protect and enforce our patents and other IP;

•new legal theories and strategies utilized by our competitors will not be successful;

•others will not independently develop similar or competing chip interfaces or design around any patents that may be issued to us; or

•factors such as difficulty in obtaining cooperation from inventors, pre-existing challenges or litigation, or license or other contract issues will not present additional challenges in securing protection with respect to patents and other IP that we acquire.

If any of the above were to occur, our operating results could be adversely affected.

Furthermore, patent reform legislation, such as the Leahy-Smith America Invents Act, could increase the uncertainties and costs surrounding the prosecution of any patent applications and the enforcement or defense of our licensed patents. The federal courts, the USPTO, the Federal Trade Commission, and the U.S. International Trade Commission have also recently taken certain actions and issued rulings that have been viewed as unfavorable to patentees. While we cannot predict what form any new patent reform laws or regulations may ultimately take, or what impact recent or future reforms may have on our business, any laws or regulations that restrict or negatively impact our ability to enforce our patent rights against third parties could have a material adverse effect on our business.

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In addition, our patents will continue to expire according to their terms, with expected expiration dates ranging from 2021 to 2040. Our failure to continuously develop or acquire successful innovations and obtain patents on those innovations could significantly harm our business, financial condition, results of operations, or cash flows.

Our inability to protect and own the intellectual property we create would cause our business to suffer.

We rely primarily on a combination of license, development and nondisclosure agreements, trademark, trade secret and copyright law and contractual provisions to protect our non-patentable IP rights. If we fail to protect these IP rights, our customers and others may seek to use our technology without the payment of license fees and royalties, which could weaken our competitive position, reduce our operating results and increase the likelihood of costly litigation. The growth of our business depends in part on the use of our IP in the products of third-party manufacturers, and our ability to enforce IP rights against them to obtain appropriate compensation. In addition, effective trade secret protection may be unavailable or limited in certain foreign countries. Although we intend to protect our rights vigorously, if we fail to do so, our business will suffer.

Effective protection of trademarks, copyrights, domain names, patent rights, and other IP rights is expensive and difficult to maintain, both in terms of application and maintenance costs, as well as the costs of defending and enforcing those rights. The efforts we have taken to protect our IP rights may not be sufficient or effective. Our IP rights may be infringed, misappropriated, or challenged, which could result in them being narrowed in scope or declared invalid or unenforceable. In addition, the laws or practices of certain countries do not protect our proprietary rights to the same extent as do the laws of the United States. Significant impairments of our IP rights, and limitations on our ability to assert our IP rights against others, could have a material and adverse effect on our business.

Third parties may claim that our products or services infringe on their intellectual property rights, exposing us to litigation that, regardless of merit, may be costly to defend.

Our success and ability to compete are also dependent upon our ability to operate without infringing upon the patent, trademark and other IP rights of others. Third parties may claim that our current or future products or services infringe upon their IP rights. Any such claim, with or without merit, could be time consuming, divert management’s attention from our business operations and result in significant expenses. We cannot assure you that we would be successful in defending against any such claims. In addition, parties making these claims may be able to obtain injunctive or other equitable relief affecting our ability to license the products that incorporate the challenged IP. As a result of such claims, we may be required to obtain licenses from third parties, develop alternative technology or redesign our products. We cannot be sure that such licenses would be available on terms acceptable to us, if at all. If a successful claim is made against us and we are unable to develop or license alternative technology, our business, financial condition, operating results and cash flows could be materially adversely affected.

Any dispute regarding our intellectual property may require us to indemnify certain customers, the cost of which could severely hamper our business operations and financial condition.

In any potential dispute involving our patents or other IP, our customers could also become the target of litigation. While we generally do not indemnify our customers, some of our agreements provide for indemnification, and some require us to provide technical support and information to a customer that is involved in litigation involving use of our technology. In addition, we may be exposed to indemnification obligations, risks and liabilities that were unknown at the time that we acquired assets or businesses for our operations. Any of these indemnification and support obligations could result in substantial and material expenses. In addition to the time and expense required for us to indemnify or supply such support to our customers, a customer’s development, marketing and sales of licensed semiconductors, mobile communications and data security technologies could be severely disrupted or shut down as a result of litigation, which in turn could severely hamper our business operations and financial condition as a result of lower or no royalty payments.

We have been party to, and may in the future be subject to, lawsuits relating to securities law matters which may result in unfavorable outcomes and significant judgments, settlements and legal expenses which could cause our business, financial condition and results of operations to suffer.

We and certain of our current and former officers and directors, as well as our current auditors, were subject from 2006 to 2011 to several stockholder derivative actions, securities fraud class actions and/or individual lawsuits filed in federal court against us and certain of our current and former officers and directors. The complaints generally alleged that the defendants violated the federal and state securities laws and stated state law claims for fraud and breach of fiduciary duty. Although to date these complaints have either been settled or dismissed, the amount of time to resolve any future lawsuits is uncertain, and these matters could require significant management and financial resources. Unfavorable outcomes and significant judgments, settlements and legal expenses in litigation related to any future securities law claims could have material adverse impacts on our business, financial condition, results of operations, cash flows and the trading price of our common stock.

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General Risk Factors

The price of our common stock may continue to fluctuate.

Our common stock is listed on The NASDAQ Global Select Market under the symbol “RMBS.” The trading price of our common stock has at times experienced price volatility and may continue to fluctuate significantly in response to various factors, some of which are beyond our control. Some of these factors include:

•any progress, or lack of progress, real or perceived, in the development of products that incorporate our innovations and technology companies’ acceptance of our products, including the results of our efforts to expand into new target markets;

•our signing or not signing new licenses or renewing existing licenses, and the loss of strategic relationships with any customer;

•announcements of technological innovations or new products by us, our customers or our competitors;

•changes in our strategies, including changes in our licensing focus and/or acquisitions or dispositions of companies or businesses with business models or target markets different from our core;

•positive or negative reports by securities analysts as to our expected financial results and business developments;

•developments with respect to patents or proprietary rights and other events or factors;

•new litigation and the unpredictability of litigation results or settlements;

•repurchases of our common stock on the open market;

•issuance of additional securities by us, including in acquisitions, or large cash payments, including in acquisitions; and

•changes in accounting pronouncements, including the effects of ASC 606 and ASC 842.

In addition, the stock market in general, and prices for companies in our industry in particular, have experienced extreme volatility that often has been unrelated to the operating performance of such companies. These broad market and industry fluctuations may adversely affect the price of our common stock, regardless of our operating performance.

We have outstanding senior convertible notes in an aggregate principal amount totaling $172.5 million. Because these notes are convertible into shares of our common stock, volatility or depressed prices of our common stock could have a similar effect on the trading price of such notes. In addition, the existence of these notes may encourage short selling in our common stock by market participants because the conversion of the notes could depress the price of our common stock.

Compliance with changing regulation of corporate governance and public disclosure may result in additional expenses.

Changing laws, regulations and standards relating to corporate governance and public disclosure have historically created uncertainty for companies such as ours. Any new or changed laws, regulations and standards are subject to varying interpretations due to their lack of specificity, and as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.

Our certificate of incorporation and bylaws, Delaware law, our outstanding convertible notes and certain other agreements contain provisions that could discourage transactions resulting in a change in control, which may negatively affect the market price of our common stock.

Our certificate of incorporation, our bylaws and Delaware law contain provisions that might enable our management to discourage, delay or prevent a change in control. In addition, these provisions could limit the price that investors would be willing to pay in the future for shares of our common stock. Pursuant to such provisions:

•our board of directors is authorized, without prior stockholder approval, to create and issue preferred stock, commonly referred to as “blank check” preferred stock, with rights senior to those of common stock, which means that a stockholder rights plan could be implemented by our board;

•our board of directors is staggered into two classes, only one of which is elected at each annual meeting;

•stockholder action by written consent is prohibited;

•nominations for election to our board of directors and the submission of matters to be acted upon by stockholders at a meeting are subject to advance notice requirements;

•certain provisions in our bylaws and certificate of incorporation such as notice to stockholders, the ability to call a stockholder meeting, advance notice requirements and action of stockholders by written consent may only be amended with the approval of stockholders holding 66 2/3% of our outstanding voting stock;

•our stockholders have no authority to call special meetings of stockholders; and

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•our board of directors is expressly authorized to make, alter or repeal our bylaws.

We are also subject to Section 203 of the Delaware General Corporation Law, which provides, subject to enumerated exceptions, that if a person acquires 15% or more of our outstanding voting stock, the person is an “interested stockholder” and may not engage in any “business combination” with us for a period of three years from the time the person acquired 15% or more of our outstanding voting stock.

Certain provisions of our outstanding Notes could make it more difficult or more expensive for a third party to acquire us. Upon the occurrence of certain transactions constituting a fundamental change, holders of such Notes will have the right, at their option, to require us to repurchase, at a cash repurchase price equal to 100% of the principal amount plus accrued and unpaid interest on such Notes, all or a portion of their Notes. We may also be required to increase the conversion rate of such Notes in the event of certain fundamental changes.

Unanticipated changes in our tax rates or in the tax laws, treaties and regulations could expose us to additional income tax liabilities, which could affect our operating results and financial condition.

We are subject to income taxes in both the United States and various foreign jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes and, in the ordinary course of business, there are many transactions and calculations where the ultimate tax determination is uncertain. Our effective tax rate could be adversely affected by several factors, many of which are outside of our control, including changes in the mix of earnings and losses in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in tax laws, rates, treaties and regulations or the interpretation of the same, changes to the financial accounting rules for income taxes, the outcome of current and future tax audits, examinations or administrative appeals and certain non-deductible expenses. Our tax determinations are regularly subject to audit by tax authorities and developments in those audits could adversely affect our income tax provision, and we are currently undergoing such audits of certain of our tax returns. Although we believe that our tax estimates are reasonable, the final determination of tax audits or tax disputes may be different from what is reflected in our historical income tax provisions, which could affect our operating results.

Recently, in the United States, the Biden administration proposed to increase the U.S. corporate income tax rate from 21% to 28%, increase U.S. taxation of international business operations and impose a global minimum tax. Many countries and organizations such as the Organization for Economic Cooperation and Development are also actively considering changes to existing tax laws or have proposed or enacted new laws that could increase our tax obligations in countries where we do business or cause us to change the way we operate our business. Any of these developments or changes in federal, state, or international tax laws or tax rulings could adversely affect our effective tax rate and our operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchase Program

On October 29, 2020, our Board approved a new share repurchase program authorizing the repurchase of up to an aggregate of 20.0 million shares (the “2020 Repurchase Program”). Share repurchases under the 2020 Repurchase Program may be made through the open market, established plans or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the 2020 Repurchase Program. As part of the broader share repurchase program authorized by our Board on October 29, 2020, we entered into an accelerated share repurchase program with Deutsche Bank AG, London Branch as counterparty, through its agent Deutsche Bank Securities Inc. (“Deutsche Bank”) on November 11, 2020 (the “2020 ASR Program”), which was completed in the second quarter of 2021. Also in the second quarter of 2021, we entered into another accelerated share repurchase program with Deutsche Bank on June 15, 2021 (the “2021 ASR Program”). After giving effect to the 2020 and 2021 ASR programs, detailed in the table below, we had remaining authorization to repurchase approximately 13.4 million shares. See Note 13, “Stockholders' Equity,” Notes to Unaudited Condensed Consolidated Financial Statements of this Form 10-Q for further discussion.

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We record stock repurchases as a reduction to stockholders’ equity. We record a portion of the purchase price of the repurchased shares as an increase to accumulated deficit when the price of the shares repurchased exceeds the average original proceeds per share received from the issuance of common stock.

Period	Total Number of Shares Purchased	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Program	Maximum Number of Shares that May Yet be Purchased Under the Program
Cumulative shares repurchased as of December 31, 2020 (1)	2,616,089	$18.63	2,616,089	17,383,911
April 1, 2021 - May 31, 2021 (1)	68,435	$18.63	68,435	17,315,476
June 1, 2021 - June 30, 2021 (2)	3,946,719	N/A (3)	3,946,719	13,368,757
Cumulative shares repurchased as of June 30, 2021	6,631,243		6,631,243

_________________________________________

(1)    In November 2020, we entered into the 2020 ASR Program with Deutsche Bank to repurchase an aggregate of $50.0 million of our common stock. We made an upfront payment of $50.0 million pursuant to the accelerated share repurchase program and received an initial delivery of 2.6 million shares which were retired and recorded as a $40.0 million reduction to stockholders' equity. The remaining $10.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to our stock. During the second quarter of 2021, the accelerated share repurchase program was completed and we received an additional 0.1 million shares of our common stock, which were retired, as the final settlement of the accelerated share repurchase program. The total shares of our common stock received and retired under the terms of the accelerated share repurchase program were 2.7 million, with an average price paid per share of $18.63.

(2)    In June 2021, we entered into the 2021 ASR Program with Deutsche Bank to repurchase an aggregate of $100.0 million of our common stock. We made an upfront payment of $100.0 million pursuant to the accelerated share repurchase program and received an initial delivery of 3.9 million shares which were retired and recorded as a $80.0 million reduction to stockholders' equity. The remaining $20.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to our stock. The number of shares to be ultimately purchased by us will be determined based on the volume-weighted average price of our common stock during the terms of the transaction, minus an agreed upon discount between the parties. The program is expected to be completed within six months from the beginning of the program.

(3)    N/A—The average price paid per share will be determined at the end of the current accelerated share repurchase program.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

INDEX TO EXHIBITS

Exhibit Number	Description of Document
10.1(1)	Master Confirmation between Deutsche Bank AG, London Branch, through its agent Deutsche Bank Securities Inc. (“Dealer”) and Rambus Inc., dated June 15, 2021.
31.1	Certification of Principal Executive Officer, pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer, pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

_________________________________________

*    The certifications furnished in Exhibit 32.1 and 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.

(1)    Incorporated by reference to the Form 8-K filed on June 16, 2021, with the Securities and Exchange Commission.

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SIGNATURE 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		RAMBUS INC.
Date:	August 6, 2021	By:	/s/ Rahul Mathur
			Rahul Mathur
			Senior Vice President, Finance and Chief Financial Officer
			(Principal Financial Officer and Duly Authorized Officer)

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EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Luc Seraphin, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Rambus Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2021
By:	/s/ Luc Seraphin
Name:	Luc Seraphin
Title:	Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Rahul Mathur, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Rambus Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2021
By:	/s/ Rahul Mathur
Name:	Rahul Mathur
Title:	Senior Vice President, Finance and Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Luc Seraphin, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Rambus Inc. for the quarter ended June 30, 2021, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Rambus Inc.

Date: August 6, 2021

By:	/s/ Luc Seraphin
Name:	Luc Seraphin
Title:	Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Rahul Mathur, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Rambus Inc. for the quarter ended June 30, 2021, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Rambus Inc.

Date: August 6, 2021

By:	/s/ Rahul Mathur
Name:	Rahul Mathur
Title:	Senior Vice President, Finance and Chief Financial Officer (Principal Financial Officer)

XML

Cover Page	6 Months Ended
	Jun. 30, 2021 shares
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Entity File Number	000-22339
Entity Registrant Name	RAMBUS INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	94-3112828
Entity Address, Address Line One	4453 North First Street
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	San Jose
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95134
City Area Code	408
Local Phone Number	462-8000
Title of 12(b) Security	Common Stock, $.001 Par Value
Trading Symbol	RMBS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	108,897,295
Entity Central Index Key	0000917273
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Amendment Flag	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 204,731	$ 128,967
Marketable securities	272,382	373,682
Accounts receivable	38,730	27,903
Unbilled receivables	144,546	138,813
Inventories	8,052	14,466
Prepaids and other current assets	10,544	15,881
Total current assets	678,985	699,712
Intangible assets, net	27,203	36,487
Goodwill	183,222	183,222
Property, plant and equipment, net	50,058	57,693
Operating lease right-of-use assets	25,801	28,708
Deferred tax assets	3,907	4,353
Unbilled receivables	179,503	236,699
Other assets	4,306	4,535
Total assets	1,152,985	1,251,409
Current liabilities:
Accounts payable	8,975	8,993
Accrued salaries and benefits	15,878	23,326
Deferred revenue	12,299	10,198
Income taxes payable	19,754	20,064
Operating lease liabilities	6,722	4,724
Other current liabilities	17,798	18,559
Total current liabilities	81,426	85,864
Convertible notes	159,806	156,031
Long-term operating lease liabilities	31,104	34,305
Long-term income taxes payable	31,853	41,333
Deferred tax liabilities	15,147	14,276
Other long-term liabilities	3,061	6,894
Total liabilities	322,397	338,703
Commitments and contingencies (Notes 9, 11 and 15)
Stockholders’ equity:
Convertible preferred stock, $.001 par value: Authorized: 5,000,000 shares; Issued and outstanding: no shares at June 30, 2021 and December 31, 2020	0	0
Common stock, $.001 par value: Authorized: 500,000,000 shares; Issued and outstanding: 108,897,295 shares at June 30, 2021 and 111,697,994 shares at December 31, 2020	109	112
Additional paid-in capital	1,257,075	1,270,426
Accumulated deficit	(426,413)	(357,751)
Accumulated other comprehensive loss	(183)	(81)
Total stockholders’ equity	830,588	912,706
Total liabilities and stockholders’ equity	$ 1,152,985	$ 1,251,409

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
Stockholders’ equity:
Convertible preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Convertible preferred stock, authorized shares	5,000,000	5,000,000
Convertible preferred stock, issued shares	0	0
Convertible preferred stock, outstanding shares	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares	500,000,000	500,000,000
Common stock, issued shares	108,897,295	111,697,994
Common stock, outstanding shares	108,897,295	111,697,994

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Revenue
Revenue	$ 84,859	$ 61,717	$ 155,241	$ 127,494
Cost of revenue
Cost of product revenue	11,422	10,277	22,832	20,620
Cost of contract and other revenue	1,017	1,535	2,573	2,733
Amortization of acquired intangible assets	4,439	4,336	8,825	8,680
Cost of revenue	16,878	16,148	34,230	32,033
Gross profit	67,981	45,569	121,011	95,461
Operating expenses:
Research and development	31,469	34,688	63,823	71,352
Sales, general and administrative	22,184	21,721	45,746	45,027
Amortization of acquired intangible assets	229	248	458	596
Restructuring charges	0	0	368	836
Change in fair value of earn-out liability	0	0	0	(1,800)
Total operating expenses	53,882	56,657	110,395	116,011
Operating income (loss)	14,099	(11,088)	10,616	(20,550)
Interest income and other income (expense), net	2,381	4,688	5,362	11,131
Interest expense	(2,683)	(2,580)	(5,297)	(5,135)
Interest and other income (expense), net	(302)	2,108	65	5,996
Income (loss) before income taxes	13,797	(8,980)	10,681	(14,554)
Provision for income taxes	2,631	160	2,128	1,125
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Net income (loss) per share:
Earnings per share, basic	$ 0.10	$ (0.08)	$ 0.08	$ (0.14)
Earnings per share, diluted	$ 0.10	$ (0.08)	$ 0.07	$ (0.14)
Weighted-average shares used in per share calculation:
Basic (in shares)	112,144	113,572	112,177	113,240
Diluted (in shares)	114,931	113,572	115,358	113,240
Product revenue
Revenue
Revenue	$ 31,170	$ 31,725	$ 61,951	$ 62,453
Royalties
Revenue
Revenue	41,910	18,744	70,769	40,226
Contract and other revenue
Revenue
Revenue	$ 11,779	$ 11,248	$ 22,521	$ 24,815

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Other comprehensive income (loss):
Foreign currency translation adjustment	4	2	(17)	2
Unrealized gain (loss) on marketable securities, net of tax	(54)	134	(85)	38
Total comprehensive income (loss)	$ 11,116	$ (9,004)	$ 8,451	$ (15,639)

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common stock	Additional paid-in capital	Accumulated deficit	Accumulated other comprehensive gain (loss)
Balance (in shares) at Dec. 31, 2019		112,131
Balance at Dec. 31, 2019	$ 975,373	$ 112	$ 1,261,142	$ (285,789)	$ (92)
Increase (Decrease) in Stockholders' Equity
Net income (loss)	(15,679)			(15,679)
Foreign currency translation adjustment	2				2
Unrealized gain (loss) on marketable securities, net of tax	38				38
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares)		1,613
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	217	$ 2	215
Stock-based compensation	12,779		12,779
Balance (in shares) at Jun. 30, 2020		113,744
Balance at Jun. 30, 2020	972,730	$ 114	1,274,136	(301,468)	(52)
Balance (in shares) at Mar. 31, 2020		113,275
Balance at Mar. 31, 2020	971,597	$ 113	1,264,000	(292,328)	(188)
Increase (Decrease) in Stockholders' Equity
Net income (loss)	(9,140)			(9,140)
Foreign currency translation adjustment	2				2
Unrealized gain (loss) on marketable securities, net of tax	134				134
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares)		469
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	3,430	$ 1	3,429
Stock-based compensation	6,707		6,707
Balance (in shares) at Jun. 30, 2020		113,744
Balance at Jun. 30, 2020	972,730	$ 114	1,274,136	(301,468)	(52)
Balance (in shares) at Dec. 31, 2020		111,698
Balance at Dec. 31, 2020	912,706	$ 112	1,270,426	(357,751)	(81)
Increase (Decrease) in Stockholders' Equity
Net income (loss)	8,553			8,553
Foreign currency translation adjustment	(17)				(17)
Unrealized gain (loss) on marketable securities, net of tax	(85)				(85)
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares)		1,214
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	(4,300)	$ 1	(4,301)
Repurchase and retirement of common stock under repurchase program		(4,015)
Repurchase and retirement of common stock under repurchase program	(100,068)	$ (4)	(22,849)	(77,215)
Stock-based compensation	13,799		13,799
Balance (in shares) at Jun. 30, 2021		108,897
Balance at Jun. 30, 2021	830,588	$ 109	1,257,075	(426,413)	(183)
Balance (in shares) at Mar. 31, 2021		112,505
Balance at Mar. 31, 2021	909,406	$ 113	1,269,790	(360,364)	(133)
Increase (Decrease) in Stockholders' Equity
Net income (loss)	11,166			11,166
Foreign currency translation adjustment	4				4
Unrealized gain (loss) on marketable securities, net of tax	(54)				(54)
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares)		407
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan	2,836	$ 0	2,836
Repurchase and retirement of common stock under repurchase program		(4,015)
Repurchase and retirement of common stock under repurchase program	(100,068)	$ (4)	(22,849)	(77,215)
Stock-based compensation	7,298		7,298
Balance (in shares) at Jun. 30, 2021		108,897
Balance at Jun. 30, 2021	$ 830,588	$ 109	$ 1,257,075	$ (426,413)	$ (183)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Cash flows from operating activities:
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Stock-based compensation			13,799	12,779
Depreciation			12,753	15,447
Amortization of intangible assets	4,700	4,600	9,284	9,276
Non-cash interest expense and amortization of convertible debt issuance costs			3,775	3,571
Deferred income taxes			1,317	53
Loss on equity investment			453	318
Loss on disposal of property, plant and equipment			0	2
Change in fair value of earn-out liability	0	0	0	(1,800)
Change in operating assets and liabilities, net of impact of acquisitions:
Accounts receivable			(10,827)	8,841
Unbilled receivables			51,463	79,842
Prepaid expenses and other assets			4,688	1,726
Inventories			6,414	(1,468)
Accounts payable			1,715	1,709
Accrued salaries and benefits and other liabilities			(3,575)	(2,030)
Income taxes payable			(9,747)	(8,643)
Deferred revenue			2,190	(1,106)
Operating lease liabilities			(1,203)	(3,565)
Net cash provided by operating activities			91,052	99,273
Cash flows from investing activities:
Purchases of property, plant, and equipment			(5,267)	(12,780)
Purchases of marketable securities			(333,782)	(487,521)
Maturities of marketable securities			260,924	407,556
Proceeds from sale of marketable securities			174,546	2,496
Settlement of working capital adjustment from disposal of business			0	(1,131)
Net cash provided by (used in) investing activities			96,421	(91,380)	$ (97,600)
Cash flows from financing activities:
Proceeds received from issuance of common stock under employee stock plans			4,186	7,880
Payments of taxes on restricted stock units			(8,486)	(7,663)
Payments under installment payment arrangements			(7,168)	(6,600)
Repurchase and retirement of common stock, including prepayment under accelerated share repurchase program			(100,068)	0
Net cash used in financing activities			(111,536)	(6,383)
Effect of exchange rate changes on cash and cash equivalents			(168)	(419)
Net increase in cash, cash equivalents and restricted cash			75,769	1,091
Cash, cash equivalents and restricted cash at beginning of period			129,324	102,518	102,518
Cash, cash equivalents and restricted cash at end of period	$ 205,093	$ 103,609	205,093	103,609	$ 129,324
Non-cash investing and financing activities during the period:
Property, plant and equipment received and accrued in accounts payable and other liabilities			$ 10,720	$ 26,354

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Cash, cash equivalents and restricted cash
Restricted cash	$ 362	$ 357

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Restatement of Consolidated Financial Statements

6 Months Ended

Jun. 30, 2021

Accounting Changes and Error Corrections [Abstract]

Restatement of Consolidated Financial Statements

Restatement of Condensed Consolidated Financial Statements and Immaterial Correction of Prior-Period Error

Rambus Inc. (the “Company” or “Rambus”) restated its previously issued consolidated financial statements and related disclosures as of and for the fiscal years ended December 31, 2020 and 2019 and presented the impact of the restatement on the relevant unaudited interim financial information for each of the quarterly periods during the years ended December 31, 2020 and 2019 on Form 10-K/A filed on March 29, 2021, in order to correct errors resulting from the incorrect application of generally accepted accounting principles relating to revenue recognition as it pertains to a single customer agreement (the “Impacted Agreement”). Additionally, to correct errors that the Company has determined to be immaterial, both individually and in aggregate, the Company also restated the consolidated financial statements for the fiscal years ended December 31, 2020 and 2019.

Impact of Restatement

The following errors in the Company’s consolidated financial statements were identified and corrected:

a) Correction of revenue related to the Impacted Agreement: During the quarter ended March 31, 2021, the Company determined that a portion of revenue under a single customer agreement that had not yet been recognized, should have been recognized during the quarters ended September 30, 2019, December 31, 2019, March 31, 2020, and June 30, 2020. The Impacted Agreement contained a single performance obligation for a license to the Company’s patents and technology in exchange for consideration, a portion of which was fixed at the inception of the contract and a portion that was dependent on the customer’s applicable sales (as stipulated in the agreement) for the four consecutive quarters commencing on July 1, 2019 and ending on June 30, 2020. The Company accounted for the agreement as a right-to-use IP license agreement with the fixed portion of the consideration appropriately recognized at the inception of the agreement when control of the license was transferred to the customer. However, the Company did not recognize as revenue the portion of the consideration that depended on the customer’s sales beginning in the quarter ended September 30, 2019. During the quarter ended March 31, 2021, the Company reassessed its accounting for this uncertain portion of the consideration and determined that revenue associated with that uncertain portion of the consideration should have been recognized over the four quarters commencing on July 1, 2019 and ending June 30, 2020, which are the periods when the uncertainty surrounding the amount of the contingent consideration was resolved (that is when the customer’s sales occurred for which the contingent payments were based). This error resulted in royalty revenue being corrected by approximately $3.6 million in each of the years ended December 31, 2020 and 2019, resulting in an increase in royalty revenue for each of the respective periods. Unbilled receivables (both current and non-current, as applicable) on the consolidated balance sheets were also increased by the correction, given this additional revenue recognized is payable by the customer in ten equal quarterly installments with the first installment payable in the quarter ended March 31, 2021. Additionally, due to the significant financing component of the Impacted Agreement, immaterial amounts were corrected to increase interest and other income (expense), net, on the consolidated statements of operations.

b) Correction of immaterial asset retirement obligation (“ARO”) related to the Company’s previous Sunnyvale, California headquarters of approximately $1.0 million in fiscal year 2019 related to facility restoration costs. The Company originally recorded a liability for the ARO but expensed (included in sales, general and administrative expenses on the consolidated statements of operations) the entire amount in the year ended December 31, 2019. The Company corrected the consolidated financial statements to record the ARO asset within property, plant and equipment, net, within the consolidated balance sheets and reflect the amortization of the ARO asset over the remaining life of the lease of seven months beginning in December of 2019 through June 2020.

c) Recording of provision for income taxes impacts due to adjustments a) and b) above.

The restatement tables below present a reconciliation from the previously reported amounts to the restated amounts (in thousands, except shares and per share amounts). The amounts originally reported were derived from the Company’s Quarterly Report on Form 10-Q for the interim period ended June 30, 2020. Certain line items in the quarterly financial data below were excluded because they were not impacted by the restatement.

	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	16,957	$	1,787	$	18,744
Total revenue	59,930		1,787		61,717
Gross profit	43,782		1,787		45,569
Operating expenses:
Sales, general and administrative	21,310		411		21,721
Total operating expenses	56,246		411		56,657
Operating income (loss)	(12,464)		1,376		(11,088)
Interest income and other income (expense), net	4,597		91		4,688
Interest and other income (expense), net	2,017		91		2,108
Income (loss) before income taxes	(10,447)		1,467		(8,980)
Provision for (benefit from) income taxes	334		(174)		160
Net income (loss)	(10,781)		1,641		(9,140)
Net income (loss) per share:
Basic	$	(0.09)	$	0.01	$	(0.08)
Diluted	$	(0.09)	$	0.01	$	(0.08)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	36,651	$	3,575	$	40,226
Total revenue	123,919		3,575		127,494
Gross profit	91,886		3,575		95,461
Operating expenses:
Sales, general and administrative	44,205		822		45,027
Total operating expenses	115,189		822		116,011
Operating income (loss)	(23,303)		2,753		(20,550)
Interest income and other income (expense), net	10,971		160		11,131
Interest and other income (expense), net	5,836		160		5,996
Income (loss) before income taxes	(17,467)		2,913		(14,554)
Provision for (benefit from) income taxes	1,297		(172)		1,125
Net income (loss)	(18,764)		3,085		(15,679)
Net income (loss) per share:
Basic	$	(0.17)	$	0.03	$	(0.14)
Diluted	$	(0.17)	$	0.03	$	(0.14)

	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(10,781)	$	1,641	$	(9,140)
Total comprehensive income (loss)	(10,645)		1,641		(9,004)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Total comprehensive income (loss)	(18,724)		3,085		(15,639)

	For the Three and Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Stockholders’ Equity
Net loss attributable to:
Accumulated deficit	$	(309,008)	$	7,540	$	(301,468)
Total stockholders’ equity	965,190		7,540		972,730

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities:
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation	14,625		822		15,447
Deferred income taxes	102		(49)		53
Change in operating assets and liabilities, net of effects of acquisitions:
Unbilled receivables	83,577		(3,735)		79,842
Prepaid expenses and other assets	1,849		(123)		1,726
Net cash provided by operating activities	99,273		—		99,273

Immaterial Correction of Prior-Period Error

Subsequent to the reissuance of the consolidated financial statements as of and for the year ended December 31, 2020, the Company determined that $7.2 million in corporate investments originally classified as cash equivalents should have been classified as marketable securities in the consolidated balance sheet as of December 31, 2020. The Company assessed the effect of this correction based on an analysis of both quantitative and qualitative factors and determined that the correction was not material. Accordingly, the Company corrected the error as of December 31, 2020 in the accompanying condensed consolidated balance sheet and related footnotes. The following adjustments were made:

•Cash and cash equivalents as of December 31, 2020 originally reported as $136.1 million was corrected to $129.0 million.

•Marketable securities as of December 31, 2020 originally reported as $366.5 million was corrected to $373.6 million.

•Correction of Note 7, “Marketable Securities” and Note 8, “Fair Value of Financial Instruments”, to reflect the above adjustments.

Additionally, in the 10-K for the period ending December 31, 2021, the Company will correct its presentation of net cash used in investing activities for the year ended December 31, 2020, which was originally reported as $90.4 million, to reflect cash used in investing activities of $97.6 million. The corrections did not affect the net cash provided by operating activities nor net cash used in financing activities.

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Basis of Presentation

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Rambus Inc. (“Rambus” or the “Company”) and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the accompanying unaudited condensed consolidated financial statements.

In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring items) necessary to state fairly the financial position and results of operations for each interim period presented. Interim results are not necessarily indicative of results for a full year.

The unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) applicable to interim financial information. Certain information and Note disclosures included in the financial statements prepared in accordance with generally accepted accounting principles have been omitted in these interim statements pursuant to such SEC rules and regulations. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto in Form 10-K/A for the year ended December 31, 2020.

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Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2021

Accounting Standards Update and Change in Accounting Principle [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted

In January 2020, the FASB issued ASU No. 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815).” The amendments in this ASU clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. This ASU is effective for interim and annual reporting periods beginning after December 15, 2020. The Company adopted this ASU on January 1, 2021 on a prospective basis. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40).” The amendments in this ASU simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Among other changes, the guidance removes the liability and equity separation models for convertible instruments. Instead, entities will account for convertible debt instruments wholly as debt unless convertible instruments contain features that require bifurcation as a derivative or that result in substantial premiums accounted for as paid-in capital. The guidance also requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share. The guidance is effective for fiscal years beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020, and can be adopted on either a retrospective or modified retrospective basis. The Company will adopt this guidance on January 1, 2022. Although the Company continues to evaluate the method of adoption and impact of this guidance on its consolidated financial statements, upon adoption the Company expects this guidance to result in a reclassification of the conversion feature balances from additional paid-in capital to debt and in a decrease of reported interest expense for its convertible notes.

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Revenue Recognition

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

Contract Balances

The contract assets are primarily related to the Company’s fixed fee IP licensing arrangements and rights to consideration for performance obligations delivered but not billed as of June 30, 2021.

The Company’s contract balances were as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Unbilled receivables	$	324,049	$	375,512
Deferred revenue	12,651		10,461

During the six months ended June 30, 2021, the Company recognized $8.3 million of revenue that was included in the contract balances as of December 31, 2020. During the six months ended June 30, 2020, the Company recognized $9.7 million of revenue that was included in the contract balances as of December 31, 2019.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Contracted but unsatisfied performance obligations were approximately $15.0 million as of June 30, 2021, which the Company primarily expects to recognize over the next 2 years.

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Earnings (Loss) Per Share

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Earnings (Loss) Per Share

Earnings (Loss) Per Share

Basic earnings (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing the earnings by the weighted-average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of incremental common shares issuable upon exercise of stock options, employee stock purchases, restricted stock and restricted stock units and shares issuable upon the conversion of convertible notes. The dilutive effect of outstanding shares is reflected in diluted earnings per share by application of the treasury stock method. This method includes consideration of the amounts to be paid by the employees and the amount of unrecognized stock-based compensation related to future services. No potential dilutive common shares are included in the computation of any diluted per share amount when a net loss is reported.

The following table sets forth the computation of basic and diluted net income (loss) per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except per share amounts)	2021		2020 (As Restated)		2021		2020 (As Restated)
Net income (loss) per share:
Numerator:
Net income (loss)	$	11,166	$	(9,140)	$	8,553	$	(15,679)
Denominator:
Weighted-average shares outstanding - basic	112,144		113,572		112,177		113,240
Effect of potential dilutive common shares	2,787		—		3,181		—
Weighted-average shares outstanding - diluted	114,931		113,572		115,358		113,240
Basic net income (loss) per share	$	0.10	$	(0.08)	$	0.08	$	(0.14)
Diluted net income (loss) per share	$	0.10	$	(0.08)	$	0.07	$	(0.14)

For the three and six months ended June 30, 2020, an additional 1.7 million and 2.1 million shares, respectively, were excluded from the weighted-average dilutive shares because there was a net loss position for the periods. During the three and six months ended June 30, 2021, the Company’s stock price exceeded the 2023 Notes' conversion price of $18.93 per share, therefore approximately 0.5 million shares for each of the three and six months ended June 30, 2021, were included in the weighted-average dilutive shares. Under the treasury stock method, the cumulative dilutive effect of the 2023 Notes would be approximately 9.1 million shares. Refer to Note 10, “Convertible Notes.”

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Intangible Assets and Goodwill

6 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets and Goodwill

Intangible Assets and Goodwill

Goodwill

The following tables present goodwill information for the six months ended June 30, 2021:

(In thousands)	As of December 31, 2020		Adjustment to Goodwill		As of June 30, 2021
Total goodwill	$	183,222	$	—	$	183,222

	As of June 30, 2021
(In thousands)	Gross Carrying Amount		Accumulated Impairment Losses		Net Carrying Amount
Total goodwill	$	204,992	$	(21,770)	$	183,222

Intangible Assets, Net

The components of the Company’s intangible assets as of June 30, 2021 and December 31, 2020 were as follows:

		As of June 30, 2021
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	265,389	$	(239,875)	$	25,514
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,604)		1,689
Non-compete agreements and trademarks	3 years	300		(300)		—
Total intangible assets		$	301,982	$	(274,779)	$	27,203

		As of December 31, 2020
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	263,789	$	(230,950)	$	32,839
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,245)		2,048
Non-compete agreements and trademarks	3 years	300		(300)		—
In-process research and development	Not applicable	1,600		—		1,600
Total intangible assets		$	301,982	$	(265,495)	$	36,487

During the three and six months ended June 30, 2021, the Company did not purchase or sell any intangible assets.

Amortization expense for intangible assets for the three and six months ended June 30, 2021 was $4.7 million and $9.3 million, respectively. Amortization expense for intangible assets for the three and six months ended June 30, 2020 was $4.6 million and $9.3 million, respectively.

The estimated future amortization of intangible assets as of June 30, 2021 was as follows (in thousands):

Years Ending December 31:	Amount
2021 (remaining six months)	$	5,540
2022	7,964
2023	7,260
2024	5,812
2025	520
Thereafter	107
Total intangible assets	$	27,203

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Segment Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

Segments and Major Customers

Operating segments are based upon Rambus’ internal organization structure, the manner in which its operations are managed, the criteria used by its Chief Operating Decision Maker (“CODM”) to evaluate segment performance and availability of separate financial information regularly reviewed for resource allocation and performance assessment.

The Company has determined its CODM to be the Chief Executive Officer (“CEO”). The CEO reviews financial information presented on a consolidated basis for purposes of managing the business, allocating resources, making operating decisions and assessing financial performance. On this basis, the Company is organized and operates as a single segment within the semiconductor space. As of June 30, 2021, the Company has a single operating and reportable segment.

Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable at June 30, 2021 and December 31, 2020, respectively, was as follows:

	As of
Customer	June 30, 2021		December 31, 2020
Customer 1	13	%	13	%
Customer 2	11	%	*
Customer 3	10	%	14	%
Customer 4	*		11	%

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*    Customer accounted for less than 10% of total accounts receivable in the period.

Revenue from the Company’s major customers representing 10% or more of total revenue for the three and six months ended June 30, 2021 and 2020, respectively, was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Customer	2021		2020 (As Restated)		2021		2020 (As Restated)
Customer A	16	%	15	%	19	%	13	%
Customer B	*		18	%	11	%	16	%
Customer C	13	%	*		*		*

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*    Customer accounted for less than 10% of total revenue in the period.

Revenue from customers in the geographic regions based on the location of contracting parties was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020 (As Restated)		2021		2020 (As Restated)
USA	$	45,541	$	32,014	$	91,692	$	66,802
Taiwan	9,018		3,752		17,861		10,816
South Korea	2,209		701		2,597		2,521
Japan	3,826		7,943		8,414		12,574
Europe	1,187		4,944		1,633		5,682
Canada	38		31		92		543
Singapore	14,330		8,802		20,668		16,432
Asia-Other	8,710		3,530		12,284		12,124
Total	$	84,859	$	61,717	$	155,241	$	127,494

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Marketable Securities

6 Months Ended

Jun. 30, 2021

Debt Securities, Available-for-sale, Sale [Abstract]

Marketable Securities

Marketable SecuritiesRambus invests its excess cash and cash equivalents primarily in U.S. government-sponsored obligations, commercial paper, corporate notes and bonds, money market funds and municipal notes and bonds that mature within three years.

All cash equivalents and marketable securities are classified as available-for-sale. Total cash, cash equivalents and marketable securities are summarized as follows:

	As of June 30, 2021
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	19,262	$	19,262	$	—	$	—	0.03	%
U.S. Government bonds and notes	64,103		64,118		1		(16)		0.08	%
Corporate notes, bonds and commercial paper	208,279		208,407		12		(140)		0.20	%
Total cash equivalents and marketable securities	291,644		291,787		13		(156)
Cash	185,469		185,469		—		—
Total cash, cash equivalents and marketable securities	$	477,113	$	477,256	$	13	$	(156)

	As of December 31, 2020
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	18,162	$	18,162	$	—	$	—	0.01	%
U.S. Government bonds and notes	169,633		169,670		3		(40)		0.12	%
Corporate notes, bonds and commercial paper	253,391		253,412		61		(82)		0.20	%
Total cash equivalents and marketable securities	441,186		441,244		64		(122)
Cash	61,463		61,463		—		—
Total cash, cash equivalents and marketable securities	$	502,649	$	502,707	$	64	$	(122)

Available-for-sale securities are reported at fair value on the balance sheets and classified along with cash as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Cash equivalents	$	19,262	$	67,504
Short-term marketable securities	272,382		373,682
Total cash equivalents and marketable securities	291,644		441,186
Cash	185,469		61,463
Total cash, cash equivalents and marketable securities	$	477,113	$	502,649

The Company continues to invest in highly rated and highly liquid debt securities. The Company holds all of its marketable securities as available-for-sale, marks them to market, and regularly reviews its portfolio to ensure adherence to its investment policy and to monitor individual investments for risk analysis, proper valuation, and unrealized losses that may be other than temporary.

The estimated fair value and gross unrealized losses of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position at June 30, 2021 and December 31, 2020 are as follows:

	Fair Value				Gross Unrealized Losses
(In thousands)	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Less than 12 months
U.S. Government bonds and notes	$	54,628	$	70,548	$	(16)	$	(40)
Corporate notes, bonds and commercial paper	149,777		181,349		(140)		(82)
Total cash equivalents and marketable securities in a continuous unrealized loss position	$	204,405	$	251,897	$	(156)	$	(122)

The gross unrealized losses at June 30, 2021 and December 31, 2020 were not material in relation to the Company’s total available-for-sale portfolio. The gross unrealized losses can be primarily attributed to a combination of market conditions as well as the demand for and duration of the U.S. government-sponsored obligations and corporate notes and bonds. The Company reasonably believes that there is no need to sell these investments and that it can recover the amortized cost of these investments. The Company has found no evidence of impairment due to credit losses in its portfolio. Therefore, these

unrealized losses were recorded in other comprehensive income (loss). However, the Company cannot provide any assurance that its portfolio of cash, cash equivalents and marketable securities will not be impacted by adverse conditions in the financial markets, which may require the Company in the future to record an impairment charge for credit losses which could adversely impact its financial results.

The contractual maturities of cash equivalents (excluding money market funds which have no maturity) and marketable securities are summarized as follows:

(In thousands)	June 30, 2021
Due less than one year	$	196,592
Due from one year through three years	75,790
Total	$	272,382

Refer to Note 8, “Fair Value of Financial Instruments,” for discussion regarding the fair value of the Company’s cash equivalents and marketable securities.

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Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the below pricing levels as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	19,262	$	19,262	$	—	$	—
U.S. Government bonds and notes	64,103		—		64,103		—
Corporate notes, bonds and commercial paper	208,279		—		208,279		—
Total available-for-sale securities	$	291,644	$	19,262	$	272,382	$	—

	As of December 31, 2020
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	18,162	$	18,162	$	—	$	—
U.S. Government bonds and notes	169,633		—		169,633		—
Corporate notes, bonds and commercial paper	253,391		—		253,391		—
Total available-for-sale securities	$	441,186	$	18,162	$	423,024	$	—

The Company monitors its investments for other-than-temporary impairment and records appropriate reductions in carrying value when necessary. The Company monitors its investments for other-than-temporary losses by considering current factors, including the economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, reductions in carrying values when necessary and the Company’s ability and intent to hold the investment for a period of time which may be sufficient for anticipated recovery in the market. Any other-than-temporary loss is reported under “Interest and other income (expense), net” on the condensed consolidated statement of operations.

During the second half of 2018, the Company made an investment in a non-marketable equity security of a private company. This equity investment is accounted for under the equity method of accounting, and the Company accounts for its equity method share of the income (loss) on a quarterly basis. As of June 30, 2021, the Company’s 25.0% ownership percentage amounted to a $2.4 million equity interest in this equity investment and it was included in other assets on the accompanying consolidated balance sheets. The Company recorded immaterial amounts on its consolidated statements of operations representing its share of the investee’s loss for the six months ended June 30, 2021 and 2020.

During the three and six months ended June 30, 2021 and 2020, there were no transfers of financial instruments between different categories of fair value.

The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021						As of December 31, 2020
(In thousands)	Face  Value		Carrying  Value		Fair Value		Face  Value		Carrying  Value		Fair Value
1.375% Convertible Senior Notes due 2023 (the “2023 Notes”)	$	172,500	$	159,806	$	227,760	$	172,500	$	156,031	$	194,709

The fair value of the convertible notes at each balance sheet date is determined based on recent quoted market prices for these notes which is a level 2 measurement. As discussed in Note 10, “Convertible Notes,” as of June 30, 2021, the convertible notes were carried at their face value of $172.5 million, less any unamortized debt discount and unamortized debt issuance costs. The carrying value of other financial instruments, including accounts receivable, accounts payable and other liabilities, approximated fair value due to their short maturities.

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Leases

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Leases

Leases

The Company leases office space, domestically and internationally, under operating leases. The Company’s leases have remaining lease terms generally between one year and ten years. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, and long-term operating lease liabilities on the Company’s unaudited condensed consolidated balance sheets. The Company does not have any finance leases.

The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of June 30, 2021 (in thousands):

Years ending December 31,	Amount
2021 (remaining six months)	$	4,330
2022	7,384
2023	4,573
2024	3,925
2025	4,043
Thereafter	21,325
Total minimum lease payments	45,580
Less: amount of lease payments representing interest	(7,754)
Present value of future minimum lease payments	37,826
Less: current obligations under leases	(6,722)
Long-term lease obligations	$	31,104

As of June 30, 2021, the weighted-average remaining lease term for the Company’s operating leases was 8.0 years and the weighted-average discount rate used to determine the present value of the Company’s operating leases was 4.3%.

Operating lease costs included in research and development and selling, general and administrative costs on the condensed consolidated statements of operations were $1.9 million and $2.9 million for the three months ended June 30, 2021 and 2020, respectively. Operating lease costs included in research and development and selling, general and administrative costs on the condensed consolidated statements of operations were $3.7 million and $5.8 million for the six months ended June 30, 2021 and 2020, respectively.

Cash paid for amounts included in the measurement of operating lease liabilities were $4.3 million and $4.3 million for the six months ended June 30, 2021 and 2020, respectively.

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Convertible Notes

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Convertible Notes

Convertible Notes

The Company’s convertible notes are shown in the following table:

	As of
(In thousands)	June 30, 2021		December 31, 2020
2023 Notes	$	172,500	$	172,500
Unamortized discount — 2023 Notes	(11,896)		(15,420)
Unamortized debt issuance costs — 2023 Notes	(798)		(1,049)
Total convertible notes	159,806		156,031
Less current portion	—		—
Total long-term convertible notes	$	159,806	$	156,031

Interest expense related to the notes for the three and six months ended June 30, 2021 and 2020 was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020		2021		2020
2023 Notes coupon interest at a rate of 1.375%	$	593	$	593	$	1,186	$	1,186
2023 Notes amortization of discount and debt issuance cost at an additional effective interest rate of 4.9%	1,901		1,798		3,775		3,571
Total interest expense on convertible notes	$	2,494	$	2,391	$	4,961	$	4,757

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

As of June 30, 2021, the Company’s material contractual obligations were as follows:

(In thousands)	Total		Remainder of 2021		2022		2023		2024		2025
Contractual obligations (1) (2)
Software licenses (3)	$	11,746	$	5,317	$	6,429	$	—	$	—	$	—
Acquisition retention bonuses (4)	6,370		3,370		3,000		—		—		—
Convertible notes	172,500		—		—		172,500		—		—
Interest payments related to convertible notes	4,750		1,186		2,372		1,192		—		—
Total	$	195,366	$	9,873	$	11,801	$	173,692	$	—	$	—

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(1)    The above table does not reflect possible payments in connection with unrecognized tax benefits of approximately $27.2 million including $24.0 million recorded as a reduction of long-term deferred tax assets and $3.2 million in long-term income taxes payable as of June 30, 2021. As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

(2)    For the Company’s lease commitments as of June 30, 2021, refer to Note 9, “Leases.”

(3)    The Company has commitments with various software vendors for agreements generally having terms longer than one year.

(4)    In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment.

Indemnifications

From time to time, the Company indemnifies certain customers as a necessary means of doing business. Indemnification covers customers for losses suffered or incurred by them as a result of any patent, copyright, or other intellectual property infringement or any other claim by any third party arising as result of the applicable agreement with the Company. The

Company generally attempts to limit the maximum amount of indemnification that the Company could be required to make under these agreements to the amount of fees received by the Company, however, this may not always be possible. The fair value of the liability as of June 30, 2021 and December 31, 2020 was not material.

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Equity Incentive Plans and Stock-Based Compensation

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Equity Incentive Plans and Stock-Based Compensation

Equity Incentive Plans and Stock-Based Compensation

A summary of shares available for grant under the Company’s plans is as follows:

	Shares Available  for Grant
Total shares available for grant as of December 31, 2020	12,412,320
Stock options forfeited	51,477
Nonvested equity stock and stock units granted (1) (2)	(3,369,905)
Nonvested equity stock and stock units forfeited (1)	1,155,509
Total shares available for grant as of June 30, 2021	10,249,401

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(1)    For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each restricted stock granted reduces the number of shares available for grant by 1.5 shares and each restricted stock forfeited increases shares available for grant by 1.5 shares.

(2)    Amount includes approximately 0.4 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2021 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below.

General Stock Option Information

The following table summarizes stock option activity under the Company’s equity incentive plans for the six months ended June 30, 2021 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of June 30, 2021.

	Options Outstanding
(In thousands, except per share amounts and years)	Number of  Shares	Weighted-  Average  Exercise Price  Per Share		Weighted-  Average  Remaining  Contractual  Term (years)	Aggregate  Intrinsic  Value
Outstanding as of December 31, 2020	964,211	$	11.08
Options granted	—	$	—
Options exercised	(99,458)	$	11.29
Options forfeited	(51,477)	$	15.09
Outstanding as of June 30, 2021	813,276	$	10.80	4.5	$	10,497
Vested or expected to vest at June 30, 2021	812,918	$	10.80	4.4	$	10,493
Options exercisable at June 30, 2021	728,233	$	10.54	4.1	$	9,590

Employee Stock Purchase Plan

Under the 2015 Employee Stock Purchase Plan (“2015 ESPP”), the Company issued 263,933 shares at a price of $11.58 per share and 277,838 shares at a price of $10.51 per share during the six months ended June 30, 2021 and 2020, respectively. As of June 30, 2021, approximately 2.9 million shares under the 2015 ESPP remained available for issuance.

Stock-Based Compensation

For the six months ended June 30, 2021 and 2020, the Company maintained stock plans covering a broad range of potential equity grants including stock options, nonvested equity stock and equity stock units and performance based instruments. In addition, the Company sponsors the 2015 ESPP, whereby eligible employees are entitled to purchase common stock semi-annually, by means of limited payroll deductions, at a 15% discount from the fair market value of the common stock as of specific dates.

Stock Options

There were no stock options granted during the three and six months ended June 30, 2021 and 2020, respectively. During the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense related to stock options of $0.1 million and $0.2 million, respectively. During the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense related to stock options of $0.1 million and $0.3 million, respectively.

As of June 30, 2021, there was $0.7 million of total unrecognized compensation cost, net of expected forfeitures, related to non-vested stock-based compensation arrangements granted under the stock option plans. That cost is expected to be recognized over a weighted-average period of 1.6 years.

Employee Stock Purchase Plan

For the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense related to the 2015 ESPP of $0.2 million and $0.8 million, respectively. For the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense related to the 2015 ESPP of $0.2 million and $0.7 million, respectively. As of June 30, 2021, there was $0.4 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under the 2015 ESPP. That cost is expected to be recognized over four months.

Valuation Assumptions

The fair value of stock awards is estimated as of the grant date using the Black-Scholes-Merton (“BSM”) option-pricing model assuming a dividend yield of 0% and the additional weighted-average assumptions as listed in the table below.

There were no stock options granted during the three and six months ended June 30, 2021 and 2020, respectively.

	Employee Stock Purchase Plan
	Six Months Ended
	June 30,
	2021	2020
Employee Stock Purchase Plan:
Expected stock price volatility	32%	46%
Risk free interest rate	0.04%	0.12%
Expected term (in years)	0.5	0.5
Weighted-average fair value of purchase rights granted under the purchase plan	$4.53	$3.50

Nonvested Equity Stock and Stock Units

The Company grants nonvested equity stock units to officers, employees and directors. During the three and six months ended June 30, 2021, the Company granted nonvested equity stock units totaling approximately 0.1 million and 2.0 million shares, respectively. During the three and six months ended June 30, 2020, the Company granted nonvested equity stock units totaling approximately 0.1 million and 1.9 million shares, respectively. These awards have a service condition, generally a service period of four years, except in the case of grants to directors, for which the service period is one year. For the three and six months ended June 30, 2021, the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $2.8 million and $41.3 million, respectively. For the three and six months ended June 30, 2020, the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $1.7 million and $29.3 million, respectively. During the first quarters of 2021 and 2020, the Company granted performance unit awards to certain Company executive officers with vesting subject to the achievement of certain performance and/or market conditions. The ultimate number of performance units that can be earned can range from 0% to 200% of target depending on performance relative to target over the applicable period. The shares earned will vest on the third anniversary of the date of grant. The Company’s shares available for grant have been reduced to reflect the shares that could be earned at the maximum target.

For the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense of approximately $7.0 million and $12.9 million, respectively, related to all outstanding nonvested equity stock grants. For the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense of approximately $6.3 million and $11.8 million, respectively, related to all outstanding nonvested equity stock grants. Unrecognized stock-based compensation related to all nonvested equity stock grants, net of estimated forfeitures, was approximately $51.5 million at June 30, 2021. This amount is expected to be recognized over a weighted-average period of 2.3 years.

The following table reflects the activity related to nonvested equity stock and stock units for the six months ended June 30, 2021:

Nonvested Equity Stock and Stock Units	Shares	Weighted-  Average  Grant-Date  Fair Value
Nonvested at December 31, 2020	4,851,265	$	12.82
Granted	1,998,321	$	20.68
Vested	(1,287,156)	$	12.35
Forfeited	(585,690)	$	15.01
Nonvested at June 30, 2021	4,976,740	$	15.84

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Stockholders' Equity

6 Months Ended

Jun. 30, 2021

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Stockholders’ Equity

Share Repurchase Programs

On October 29, 2020, the Board approved a new share repurchase program authorizing the repurchase of up to an aggregate of 20.0 million shares (the “2020 Repurchase Program”). Share repurchases under the 2020 Repurchase Program may be made through the open market, established plans or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the 2020 Repurchase Program. During the six months ended June 30, 2021, the Company repurchased shares of its common stock under the 2020 Repurchase Program as discussed below.

On November 11, 2020, the Company entered into an accelerated share repurchase program with Deutsche Bank AG, London Branch as counterparty, through its agent Deutsche Bank Securities Inc. (“Deutsche Bank”) (the “2020 ASR Program”). The 2020 ASR Program was part of the share repurchase program previously authorized by the Company’s Board on October 29, 2020. Under the 2020 ASR Program, the Company pre-paid to Deutsche Bank the $50.0 million purchase price for its common stock and, in turn, the Company received an initial delivery of approximately 2.6 million shares of its common stock from Deutsche Bank in the fourth quarter of 2020, which were retired and recorded as a $40.0 million reduction to stockholders’ equity. The remaining $10.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to the Company’s stock. During the second quarter of 2021, the accelerated share repurchase program was completed and the Company received an additional 0.1 million shares of its common stock as the final settlement of the accelerated share repurchase program.

On June 15, 2021, the Company entered into an accelerated share repurchase program with Deutsche Bank (the “2021 ASR Program”). The 2021 ASR Program was part of the share repurchase program previously authorized by the Company’s Board on October 29, 2020. Under the 2021 ASR Program, the Company pre-paid to Deutsche Bank the $100.0 million purchase price for its common stock and, in turn, the Company received an initial delivery of approximately 3.9 million shares of its common stock from Deutsche Bank in the second quarter of 2021, which were retired and recorded as a $80.0 million reduction to stockholders’ equity. The remaining $20.0 million of the initial payment was recorded as a reduction to stockholders’ equity as an unsettled forward contract indexed to the Company’s stock.

The number of shares to be ultimately purchased by the Company will be determined based on the volume-weighted average price of the Company’s common stock during the term of the transaction, minus an agreed upon discount between the parties. The 2021 ASR Program is expected to be completed within six months from the beginning of the program.

During the six months ended June 30, 2021, there were no other repurchases of the Company’s common stock under the 2020 Repurchase Program.

As of June 30, 2021, there remained an outstanding authorization to repurchase approximately 13.4 million shares of the Company’s outstanding common stock under the 2020 Repurchase Program.

The Company records stock repurchases as a reduction to stockholders’ equity. The Company records a portion of the purchase price of the repurchased shares as an increase to accumulated deficit when the price of the shares repurchased exceeds the average original proceeds per share received from the issuance of common stock. During the six months ended June 30, 2021, the cumulative price of $77.2 million was recorded as an increase to accumulated deficit.

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Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company recorded a provision for income taxes of $2.6 million and $0.2 million for the three months ended June 30, 2021 and 2020, respectively, and $2.1 million and $1.1 million for the six months ended June 30, 2021 and 2020, respectively. The provision for income taxes for the three and six months ended June 30, 2021 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the statutory tax expense for the foreign jurisdictions for 2021, the valuation allowance on the Canadian deferred tax assets, and indefinite-lived intangible tax amortization expense. The provision for income taxes for the three and six months ended June 30, 2020 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the projected annual effective tax rate for the foreign jurisdictions for 2020, partial California deferred tax asset valuation allowance release, and indefinite-lived intangible tax amortization expense.

During the three months ended June 30, 2021 and 2020, the Company paid withholding taxes of $5.0 million and $5.1 million, respectively. During the six months ended June 30, 2021 and 2020, the Company paid withholding taxes of $10.5 million and $9.6 million, respectively.

The Company periodically evaluates the realizability of its net deferred tax assets based on all available evidence, both positive and negative. During the third quarter of 2018, the Company assessed the changes in its underlying facts and circumstances and evaluated the realizability of its existing deferred tax assets based on all available evidence, both positive and negative, and the weight accorded to each, and concluded a full valuation allowance associated with U.S. federal and California deferred tax assets was appropriate. The Company continues to maintain a full valuation allowance against its U.S. federal deferred tax assets. During 2020, as a result of the enactment of California A.B. 85 and the temporary suspension of California net operating loss utilization for tax years 2020 through 2022, the Company released $0.7 million of the valuation allowance on its deferred tax asset for California research and development tax credits. The Company continues to maintain a full valuation allowance on the remainder of its California deferred tax assets as it does not expect to be able to fully utilize them.

The Company has U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax attributes that can be used to offset U.S. federal taxable income in future periods. These credit carryforwards will expire if they are not used within certain time periods. It is possible that some or all of these attributes could ultimately expire unused.

The Company maintains liabilities for uncertain tax positions within its long-term income taxes payable accounts and as a reduction to existing deferred tax assets to the extent tax attributes are available to offset such liabilities. These liabilities involve judgment and estimation and are monitored by management based on the best information available including changes in tax regulations, the outcome of relevant court cases and other information.

As of June 30, 2021, the Company had approximately $144.7 million of unrecognized tax benefits, including $24.0 million recorded as a reduction of long-term deferred tax assets, $117.5 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea (Korea), and $3.2 million recorded in long-term income taxes payable. If recognized, $3.2 million would be recorded as an income tax benefit. As a result of recent court rulings in Korea, the Company has determined that they may be entitled to refund claims for foreign taxes previously withheld from licensees in Korea. The Company recognizes that there are numerous risks and uncertainties associated with the ultimate collection of this refund and has therefore maintained an offsetting reserve for the entire amount of refundable withholding taxes previously withheld in Korea. As of December 31, 2020, the Company had $134.0 million of unrecognized tax benefits, including $23.6 million recorded as a reduction of long-term deferred tax assets, $109 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea, and $1.9 million recorded in long-term income taxes payable.

Although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

The Company recognizes interest and penalties related to uncertain tax positions as a component of the income tax provision. At June 30, 2021 and December 31, 2020, an immaterial amount of interest and penalties is included in long-term income taxes payable.

Rambus files income tax returns for the U.S., California, India, the U.K., the Netherlands and various other state and foreign jurisdictions. The U.S. federal returns are subject to examination from 2016 and forward. The California returns are subject to examination from 2010 and forward. In addition, any research and development credit carryforward or net operating loss carryforward generated in prior years and utilized in these or future years may also be subject to examination. The India returns are subject to examination from fiscal year ending March 2012 and forward. The Company is currently under examination by California for the 2010, 2011, 2016 and 2018 tax years, and by New York for the 2017 through 2019 tax years. The Company’s India subsidiary is under examination by the Indian tax administration for tax years beginning with 2011, except for 2014, which was assessed in the Company’s favor. These examinations may result in proposed adjustments to the income taxes as

filed during these periods. Management regularly assesses the likelihood of outcomes resulting from income tax examinations to determine the adequacy of their provision for income taxes and believes their provision for unrecognized tax benefits is adequate.

Additionally, the Company’s future effective tax rates could be adversely affected by earnings being higher than anticipated in countries where the Company has higher statutory rates or lower than anticipated in countries where it has lower statutory rates, by changes in valuation of its deferred tax assets and liabilities or by changes in tax laws or interpretations of those laws.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. The CARES Act includes a number of federal income tax law changes, including, but not limited to (1) permitting net operating loss carrybacks to offset 100% of taxable income for taxable years beginning before 2021, (2) accelerating alternative minimum tax credit refunds, (3) temporarily increasing the allowable business interest deduction from 30% to 50% of adjusted taxable income, and (4) providing a technical correction for depreciation related to qualified improvement property. The CARES Act did not have a material impact on the Company’s condensed consolidated financial statements.

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Litigation and Asserted Claims

6 Months Ended

Jun. 30, 2021

Disclosure Text Block Supplement [Abstract]

Litigation and Asserted Claims

Litigation and Asserted Claims

Rambus is not currently a party to any material pending legal proceeding; however, from time to time, Rambus may become involved in legal proceedings or be subject to claims arising in the ordinary course of its business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on our business, operating results, financial position or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management attention and resources and other factors.

The Company records a contingent liability when it is probable that a loss has been incurred and the amount is reasonably estimable in accordance with accounting for contingencies.

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Restructuring Charges

6 Months Ended

Jun. 30, 2021

Restructuring and Related Activities [Abstract]

Restructuring Charges

Restructuring Charges

2020 Restructuring Plan

In November 2020, the Company initiated a restructuring plan to reduce overall expenses which is expected to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2020 Restructuring Plan”). In connection with this restructuring plan, the Company initiated a plan of termination resulting in a reduction of approximately 70 employees. During the six months ended June 30, 2021, the Company recorded additional charges of approximately $0.4 million related primarily to the reduction in workforce. No charge was recorded during the three months ended June 30, 2021. The 2020 Restructuring Plan was completed in the second quarter of 2021.

2019 Restructuring Plan

In June 2019, the Company initiated a restructuring plan to reduce overall expenses to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2019 Restructuring Plan”). In connection with the 2019 Restructuring Plan, the Company initiated a plan of termination resulting in a reduction of approximately 80 employees. During 2020, the Company recorded a charge of approximately $0.8 million related to the reduction in workforce. The 2019 Restructuring Plan was substantially completed in the second quarter of 2020.

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Subsequent Events

6 Months Ended

Jun. 30, 2021

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

AnalogX Inc.

On July 2, 2021, the Company completed its acquisition of all of the outstanding shares of AnalogX Inc. (“AnalogX”). AnalogX is a premier interconnect IP company. The Company acquired AnalogX for total cash consideration of approximately $47.7 million, including certain deferred payments and working capital adjustments, pursuant to the terms of the Purchase Agreement.

In accordance with ASC 805, “Business Combinations,” the acquisitions of AnalogX will be recorded as purchase business acquisitions in the Company’s financial results for the three and nine months ended September 30, 2021. Given the timing of the completion of the AnalogX acquisition, the Company is currently in the process of valuing the assets acquired and liabilities assumed in the acquisition. As a result, the Company is unable to provide the amount recognized as of the acquisition date for the major classes of assets acquired and liabilities assumed and certain disclosures pertaining to the deferred payments. The

Company will provide these disclosures in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2021.

PLDA Group

On June 16, 2021, the Company announced that it had entered into an agreement to acquire PLDA Group (“PLDA”). PLDA is a provider of high-speed interconnect solutions. The Company will acquire PLDA for an initial cash consideration of approximately $60 million and 0.3 million shares of the Company’s common stock. In addition, pursuant to the terms of an earn-out agreement, based upon the achievement of certain milestones, the Company will issue shares of the Company’s common stock, up to the following maximum amounts: 0.3 million shares after the first anniversary of the transaction, 0.4 million shares after the second anniversary, and 0.5 million shares after the third anniversary. The transaction with PLDA, which is subject to customary closing conditions and approvals, is expected to close in the third quarter of 2021.

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Restatement of Consolidated Financial Statements (Tables)

6 Months Ended

Jun. 30, 2021

Accounting Changes and Error Corrections [Abstract]

Schedule of Error Corrections and Prior Period Adjustments

The restatement tables below present a reconciliation from the previously reported amounts to the restated amounts (in thousands, except shares and per share amounts). The amounts originally reported were derived from the Company’s Quarterly Report on Form 10-Q for the interim period ended June 30, 2020. Certain line items in the quarterly financial data below were excluded because they were not impacted by the restatement.

	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	16,957	$	1,787	$	18,744
Total revenue	59,930		1,787		61,717
Gross profit	43,782		1,787		45,569
Operating expenses:
Sales, general and administrative	21,310		411		21,721
Total operating expenses	56,246		411		56,657
Operating income (loss)	(12,464)		1,376		(11,088)
Interest income and other income (expense), net	4,597		91		4,688
Interest and other income (expense), net	2,017		91		2,108
Income (loss) before income taxes	(10,447)		1,467		(8,980)
Provision for (benefit from) income taxes	334		(174)		160
Net income (loss)	(10,781)		1,641		(9,140)
Net income (loss) per share:
Basic	$	(0.09)	$	0.01	$	(0.08)
Diluted	$	(0.09)	$	0.01	$	(0.08)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Operations
Revenue:
Royalties	$	36,651	$	3,575	$	40,226
Total revenue	123,919		3,575		127,494
Gross profit	91,886		3,575		95,461
Operating expenses:
Sales, general and administrative	44,205		822		45,027
Total operating expenses	115,189		822		116,011
Operating income (loss)	(23,303)		2,753		(20,550)
Interest income and other income (expense), net	10,971		160		11,131
Interest and other income (expense), net	5,836		160		5,996
Income (loss) before income taxes	(17,467)		2,913		(14,554)
Provision for (benefit from) income taxes	1,297		(172)		1,125
Net income (loss)	(18,764)		3,085		(15,679)
Net income (loss) per share:
Basic	$	(0.17)	$	0.03	$	(0.14)
Diluted	$	(0.17)	$	0.03	$	(0.14)

	For the Three Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(10,781)	$	1,641	$	(9,140)
Total comprehensive income (loss)	(10,645)		1,641		(9,004)

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Comprehensive Loss
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Total comprehensive income (loss)	(18,724)		3,085		(15,639)

	For the Three and Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Stockholders’ Equity
Net loss attributable to:
Accumulated deficit	$	(309,008)	$	7,540	$	(301,468)
Total stockholders’ equity	965,190		7,540		972,730

	For the Six Months Ended June 30, 2020
	As Originally Reported		Adjustments		As Restated
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities:
Net income (loss)	$	(18,764)	$	3,085	$	(15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation	14,625		822		15,447
Deferred income taxes	102		(49)		53
Change in operating assets and liabilities, net of effects of acquisitions:
Unbilled receivables	83,577		(3,735)		79,842
Prepaid expenses and other assets	1,849		(123)		1,726
Net cash provided by operating activities	99,273		—		99,273

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Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

Contract balances

The Company’s contract balances were as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Unbilled receivables	$	324,049	$	375,512
Deferred revenue	12,651		10,461

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Earnings (Loss) Per Share (Tables)

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Computation of basic and diluted net income (loss) per share

The following table sets forth the computation of basic and diluted net income (loss) per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except per share amounts)	2021		2020 (As Restated)		2021		2020 (As Restated)
Net income (loss) per share:
Numerator:
Net income (loss)	$	11,166	$	(9,140)	$	8,553	$	(15,679)
Denominator:
Weighted-average shares outstanding - basic	112,144		113,572		112,177		113,240
Effect of potential dilutive common shares	2,787		—		3,181		—
Weighted-average shares outstanding - diluted	114,931		113,572		115,358		113,240
Basic net income (loss) per share	$	0.10	$	(0.08)	$	0.08	$	(0.14)
Diluted net income (loss) per share	$	0.10	$	(0.08)	$	0.07	$	(0.14)

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Intangible Assets and Goodwill (Tables)

6 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of changes in carrying amount of goodwill

The following tables present goodwill information for the six months ended June 30, 2021:

(In thousands)	As of December 31, 2020		Adjustment to Goodwill		As of June 30, 2021
Total goodwill	$	183,222	$	—	$	183,222

	As of June 30, 2021
(In thousands)	Gross Carrying Amount		Accumulated Impairment Losses		Net Carrying Amount
Total goodwill	$	204,992	$	(21,770)	$	183,222

Components of intangible assets

The components of the Company’s intangible assets as of June 30, 2021 and December 31, 2020 were as follows:

		As of June 30, 2021
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	265,389	$	(239,875)	$	25,514
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,604)		1,689
Non-compete agreements and trademarks	3 years	300		(300)		—
Total intangible assets		$	301,982	$	(274,779)	$	27,203

		As of December 31, 2020
(In thousands)	Useful Life	Gross Carrying  Amount		Accumulated  Amortization		Net Carrying  Amount
Existing technology	3 to 10 years	$	263,789	$	(230,950)	$	32,839
Customer contracts and contractual relationships	0.5 to 10 years	36,293		(34,245)		2,048
Non-compete agreements and trademarks	3 years	300		(300)		—
In-process research and development	Not applicable	1,600		—		1,600
Total intangible assets		$	301,982	$	(265,495)	$	36,487

Estimated future amortization of intangible assets

The estimated future amortization of intangible assets as of June 30, 2021 was as follows (in thousands):

Years Ending December 31:	Amount
2021 (remaining six months)	$	5,540
2022	7,964
2023	7,260
2024	5,812
2025	520
Thereafter	107
Total intangible assets	$	27,203

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2021

Concentration risk

Revenue from external customer by geographic regions

Revenue from customers in the geographic regions based on the location of contracting parties was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020 (As Restated)		2021		2020 (As Restated)
USA	$	45,541	$	32,014	$	91,692	$	66,802
Taiwan	9,018		3,752		17,861		10,816
South Korea	2,209		701		2,597		2,521
Japan	3,826		7,943		8,414		12,574
Europe	1,187		4,944		1,633		5,682
Canada	38		31		92		543
Singapore	14,330		8,802		20,668		16,432
Asia-Other	8,710		3,530		12,284		12,124
Total	$	84,859	$	61,717	$	155,241	$	127,494

Accounts receivable

Concentration risk

Schedule of customer accounts representing 10% or more than 10% of total

Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable at June 30, 2021 and December 31, 2020, respectively, was as follows:

	As of
Customer	June 30, 2021		December 31, 2020
Customer 1	13	%	13	%
Customer 2	11	%	*
Customer 3	10	%	14	%
Customer 4	*		11	%

_________________________________________

*    Customer accounted for less than 10% of total accounts receivable in the period.

Revenue

Concentration risk

Schedule of customer accounts representing 10% or more than 10% of total

Revenue from the Company’s major customers representing 10% or more of total revenue for the three and six months ended June 30, 2021 and 2020, respectively, was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Customer	2021		2020 (As Restated)		2021		2020 (As Restated)
Customer A	16	%	15	%	19	%	13	%
Customer B	*		18	%	11	%	16	%
Customer C	13	%	*		*		*

_________________________________________

*    Customer accounted for less than 10% of total revenue in the period.

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Marketable Securities (Tables)

6 Months Ended

Jun. 30, 2021

Debt Securities, Available-for-sale, Sale [Abstract]

Cash equivalents and marketable securities classified as available-for-sale

Total cash, cash equivalents and marketable securities are summarized as follows:

	As of June 30, 2021
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	19,262	$	19,262	$	—	$	—	0.03	%
U.S. Government bonds and notes	64,103		64,118		1		(16)		0.08	%
Corporate notes, bonds and commercial paper	208,279		208,407		12		(140)		0.20	%
Total cash equivalents and marketable securities	291,644		291,787		13		(156)
Cash	185,469		185,469		—		—
Total cash, cash equivalents and marketable securities	$	477,113	$	477,256	$	13	$	(156)

	As of December 31, 2020
(In thousands)	Fair Value		Amortized  Cost		Gross  Unrealized  Gains		Gross  Unrealized  Losses		Weighted  Rate of  Return
Money market funds	$	18,162	$	18,162	$	—	$	—	0.01	%
U.S. Government bonds and notes	169,633		169,670		3		(40)		0.12	%
Corporate notes, bonds and commercial paper	253,391		253,412		61		(82)		0.20	%
Total cash equivalents and marketable securities	441,186		441,244		64		(122)
Cash	61,463		61,463		—		—
Total cash, cash equivalents and marketable securities	$	502,649	$	502,707	$	64	$	(122)

Available-for-sale securities reported at fair value

Available-for-sale securities are reported at fair value on the balance sheets and classified along with cash as follows:

	As of
(In thousands)	June 30, 2021		December 31, 2020
Cash equivalents	$	19,262	$	67,504
Short-term marketable securities	272,382		373,682
Total cash equivalents and marketable securities	291,644		441,186
Cash	185,469		61,463
Total cash, cash equivalents and marketable securities	$	477,113	$	502,649

Estimated fair value of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position

The estimated fair value and gross unrealized losses of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position at June 30, 2021 and December 31, 2020 are as follows:

	Fair Value				Gross Unrealized Losses
(In thousands)	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Less than 12 months
U.S. Government bonds and notes	$	54,628	$	70,548	$	(16)	$	(40)
Corporate notes, bonds and commercial paper	149,777		181,349		(140)		(82)
Total cash equivalents and marketable securities in a continuous unrealized loss position	$	204,405	$	251,897	$	(156)	$	(122)

Contractual maturities of cash equivalents (excluding money market funds which have no maturity) and marketable securities

The contractual maturities of cash equivalents (excluding money market funds which have no maturity) and marketable securities are summarized as follows:

(In thousands)	June 30, 2021
Due less than one year	$	196,592
Due from one year through three years	75,790
Total	$	272,382

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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Summary of the valuation of cash equivalents and marketable securities by pricing levels

The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the below pricing levels as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	19,262	$	19,262	$	—	$	—
U.S. Government bonds and notes	64,103		—		64,103		—
Corporate notes, bonds and commercial paper	208,279		—		208,279		—
Total available-for-sale securities	$	291,644	$	19,262	$	272,382	$	—

	As of December 31, 2020
(In thousands)	Total		Quoted Market Prices in Active Markets  (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs  (Level 3)
Money market funds	$	18,162	$	18,162	$	—	$	—
U.S. Government bonds and notes	169,633		—		169,633		—
Corporate notes, bonds and commercial paper	253,391		—		253,391		—
Total available-for-sale securities	$	441,186	$	18,162	$	423,024	$	—

Financial instruments not carried at fair value but requiring fair value disclosure

The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of June 30, 2021 and December 31, 2020:

	As of June 30, 2021						As of December 31, 2020
(In thousands)	Face  Value		Carrying  Value		Fair Value		Face  Value		Carrying  Value		Fair Value
1.375% Convertible Senior Notes due 2023 (the “2023 Notes”)	$	172,500	$	159,806	$	227,760	$	172,500	$	156,031	$	194,709

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Leases (Tables)

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Lessee, operating lease liability, maturities and undiscounted cash flows

The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of June 30, 2021 (in thousands):

Years ending December 31,	Amount
2021 (remaining six months)	$	4,330
2022	7,384
2023	4,573
2024	3,925
2025	4,043
Thereafter	21,325
Total minimum lease payments	45,580
Less: amount of lease payments representing interest	(7,754)
Present value of future minimum lease payments	37,826
Less: current obligations under leases	(6,722)
Long-term lease obligations	$	31,104

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Convertible Notes (Tables)

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Schedule of convertible notes

The Company’s convertible notes are shown in the following table:

	As of
(In thousands)	June 30, 2021		December 31, 2020
2023 Notes	$	172,500	$	172,500
Unamortized discount — 2023 Notes	(11,896)		(15,420)
Unamortized debt issuance costs — 2023 Notes	(798)		(1,049)
Total convertible notes	159,806		156,031
Less current portion	—		—
Total long-term convertible notes	$	159,806	$	156,031

Schedule of interest expense on notes

Interest expense related to the notes for the three and six months ended June 30, 2021 and 2020 was as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2021		2020		2021		2020
2023 Notes coupon interest at a rate of 1.375%	$	593	$	593	$	1,186	$	1,186
2023 Notes amortization of discount and debt issuance cost at an additional effective interest rate of 4.9%	1,901		1,798		3,775		3,571
Total interest expense on convertible notes	$	2,494	$	2,391	$	4,961	$	4,757

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Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Schedule of material contractual obligations

As of June 30, 2021, the Company’s material contractual obligations were as follows:

(In thousands)	Total		Remainder of 2021		2022		2023		2024		2025
Contractual obligations (1) (2)
Software licenses (3)	$	11,746	$	5,317	$	6,429	$	—	$	—	$	—
Acquisition retention bonuses (4)	6,370		3,370		3,000		—		—		—
Convertible notes	172,500		—		—		172,500		—		—
Interest payments related to convertible notes	4,750		1,186		2,372		1,192		—		—
Total	$	195,366	$	9,873	$	11,801	$	173,692	$	—	$	—

_________________________________________

(1)    The above table does not reflect possible payments in connection with unrecognized tax benefits of approximately $27.2 million including $24.0 million recorded as a reduction of long-term deferred tax assets and $3.2 million in long-term income taxes payable as of June 30, 2021. As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

(2)    For the Company’s lease commitments as of June 30, 2021, refer to Note 9, “Leases.”

(3)    The Company has commitments with various software vendors for agreements generally having terms longer than one year.

(4)    In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment.

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Equity Incentive Plans and Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Schedule of shares available for grant

A summary of shares available for grant under the Company’s plans is as follows:

	Shares Available  for Grant
Total shares available for grant as of December 31, 2020	12,412,320
Stock options forfeited	51,477
Nonvested equity stock and stock units granted (1) (2)	(3,369,905)
Nonvested equity stock and stock units forfeited (1)	1,155,509
Total shares available for grant as of June 30, 2021	10,249,401

_________________________________________

(1)    For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each restricted stock granted reduces the number of shares available for grant by 1.5 shares and each restricted stock forfeited increases shares available for grant by 1.5 shares.

(2)    Amount includes approximately 0.4 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2021 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below.

Schedule of stock option activity

The following table summarizes stock option activity under the Company’s equity incentive plans for the six months ended June 30, 2021 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of June 30, 2021.

	Options Outstanding
(In thousands, except per share amounts and years)	Number of  Shares	Weighted-  Average  Exercise Price  Per Share		Weighted-  Average  Remaining  Contractual  Term (years)	Aggregate  Intrinsic  Value
Outstanding as of December 31, 2020	964,211	$	11.08
Options granted	—	$	—
Options exercised	(99,458)	$	11.29
Options forfeited	(51,477)	$	15.09
Outstanding as of June 30, 2021	813,276	$	10.80	4.5	$	10,497
Vested or expected to vest at June 30, 2021	812,918	$	10.80	4.4	$	10,493
Options exercisable at June 30, 2021	728,233	$	10.54	4.1	$	9,590

Weighted-average assumptions for employee stock purchase plan

	Employee Stock Purchase Plan
	Six Months Ended
	June 30,
	2021	2020
Employee Stock Purchase Plan:
Expected stock price volatility	32%	46%
Risk free interest rate	0.04%	0.12%
Expected term (in years)	0.5	0.5
Weighted-average fair value of purchase rights granted under the purchase plan	$4.53	$3.50

Schedule of nonvested equity stock and stock units activity

The following table reflects the activity related to nonvested equity stock and stock units for the six months ended June 30, 2021:

Nonvested Equity Stock and Stock Units	Shares	Weighted-  Average  Grant-Date  Fair Value
Nonvested at December 31, 2020	4,851,265	$	12.82
Granted	1,998,321	$	20.68
Vested	(1,287,156)	$	12.35
Forfeited	(585,690)	$	15.01
Nonvested at June 30, 2021	4,976,740	$	15.84

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Restatement of Consolidated Financial Statements - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Error correction and prior-period adjustments
Revenue	$ 84,859	$ 61,717	$ 155,241	$ 127,494
Fair value, available-for-sale securities	291,644		291,644		$ 441,186
Cash and cash equivalents	204,731		204,731		128,967
Marketable securities	272,382		272,382		373,682
Net cash used in investing activities			96,421	(91,380)	(97,600)
Adjustments
Error correction and prior-period adjustments
Revenue		1,787		3,575
Fair value, available-for-sale securities					7,200
Adjustments | Sunnyvale Facility, Second Amended
Error correction and prior-period adjustments
Asset retirement obligation						$ 1,000
As originally reported
Error correction and prior-period adjustments
Revenue		59,930		123,919
Cash and cash equivalents					136,100
Marketable securities					366,500
Net cash used in investing activities					(90,400)
Royalties
Error correction and prior-period adjustments
Revenue	$ 41,910	18,744	$ 70,769	40,226
Royalties | Adjustments
Error correction and prior-period adjustments
Revenue		1,787		3,575	$ 3,600	$ 3,600
Royalties | As originally reported
Error correction and prior-period adjustments
Revenue		$ 16,957		$ 36,651

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Restatement of Consolidated Financial Statements - Consolidated Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Revenue
Revenue	$ 84,859	$ 61,717	$ 155,241	$ 127,494
Gross profit	67,981	45,569	121,011	95,461
Operating expenses
Sales, general and administrative	22,184	21,721	45,746	45,027
Total operating expenses	53,882	56,657	110,395	116,011
Operating income (loss)	14,099	(11,088)	10,616	(20,550)
Interest income and other income (expense), net		4,688		11,131
Interest and other income (expense), net	(302)	2,108	65	5,996
Income (loss) before income taxes		(8,980)		(14,554)
Provision for income taxes	2,631	160	2,128	1,125
Net income (loss)	11,166	$ (9,140)	8,553	$ (15,679)
Net income (loss) per share:
Basic (in dollars per share)		$ (0.08)		$ (0.14)
Diluted (in dollars per share)		$ (0.08)		$ (0.14)
As originally reported
Revenue
Revenue		$ 59,930		$ 123,919
Gross profit		43,782		91,886
Operating expenses
Sales, general and administrative		21,310		44,205
Total operating expenses		56,246		115,189
Operating income (loss)		(12,464)		(23,303)
Interest income and other income (expense), net		4,597		10,971
Interest and other income (expense), net		2,017		5,836
Income (loss) before income taxes		(10,447)		(17,467)
Provision for income taxes		334		1,297
Net income (loss)		$ (10,781)		$ (18,764)
Net income (loss) per share:
Basic (in dollars per share)		$ (0.09)		$ (0.17)
Diluted (in dollars per share)		$ (0.09)		$ (0.17)
Adjustments
Revenue
Revenue		$ 1,787		$ 3,575
Gross profit		1,787		3,575
Operating expenses
Sales, general and administrative		411		822
Total operating expenses		411		822
Operating income (loss)		1,376		2,753
Interest income and other income (expense), net		91		160
Interest and other income (expense), net		91		160
Income (loss) before income taxes		1,467		2,913
Provision for income taxes		(174)		(172)
Net income (loss)		$ 1,641		$ 3,085
Net income (loss) per share:
Basic (in dollars per share)		$ 0.01		$ 0.03
Diluted (in dollars per share)		$ 0.01		$ 0.03
Royalties
Revenue
Revenue	$ 41,910	$ 18,744	$ 70,769	$ 40,226
Royalties | As originally reported
Revenue
Revenue		16,957		36,651
Royalties | Adjustments
Revenue
Revenue		$ 1,787		$ 3,575	$ 3,600	$ 3,600

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Restatement of Consolidated Financial Statements - Consolidated Statement of Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Error correction and prior-period adjustments
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Total comprehensive income (loss)	$ 11,116	(9,004)	$ 8,451	(15,639)
As originally reported
Error correction and prior-period adjustments
Net income (loss)		(10,781)		(18,764)
Total comprehensive income (loss)		(10,645)		(18,724)
Adjustments
Error correction and prior-period adjustments
Net income (loss)		1,641		3,085
Total comprehensive income (loss)		$ 1,641		$ 3,085

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Restatement of Consolidated Financial Statements - Consolidated Statement of Stockholders' Equity (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019
Error correction and prior-period adjustments
Total stockholders’ equity	$ 830,588	$ 909,406	$ 912,706	$ 972,730	$ 971,597	$ 975,373
As originally reported
Error correction and prior-period adjustments
Total stockholders’ equity				965,190
Adjustments
Error correction and prior-period adjustments
Total stockholders’ equity				7,540
Accumulated deficit
Error correction and prior-period adjustments
Total stockholders’ equity	$ (426,413)	$ (360,364)	$ (357,751)	(301,468)	$ (292,328)	$ (285,789)
Accumulated deficit | As originally reported
Error correction and prior-period adjustments
Total stockholders’ equity				(309,008)
Accumulated deficit | Adjustments
Error correction and prior-period adjustments
Total stockholders’ equity				$ 7,540

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Restatement of Consolidated Financial Statements - Consolidated Statement of Cash Flows Adjustments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Cash flows from operating activities:
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation				15,447
Deferred income taxes			1,317	53
Change in operating assets and liabilities, net of impact of acquisitions:
Unbilled receivables				79,842
Prepaid expenses and other assets			4,688	1,726
Net cash provided by operating activities			$ 91,052	99,273
As originally reported
Cash flows from operating activities:
Net income (loss)		(10,781)		(18,764)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation				14,625
Deferred income taxes				102
Change in operating assets and liabilities, net of impact of acquisitions:
Unbilled receivables				83,577
Prepaid expenses and other assets				1,849
Net cash provided by operating activities				99,273
Adjustments
Cash flows from operating activities:
Net income (loss)		$ 1,641		3,085
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation				822
Deferred income taxes				(49)
Change in operating assets and liabilities, net of impact of acquisitions:
Unbilled receivables				(3,735)
Prepaid expenses and other assets				(123)
Net cash provided by operating activities				$ 0

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Revenue Recognition (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Unbilled receivables	$ 324,049	$ 375,512
Deferred revenue	$ 12,651	$ 10,461

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Revenue Recognition (Details 2) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Revenue from Contract with Customer [Abstract]
Contract balances, revenue recognized	$ 8.3	$ 9.7

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Revenue Recognition (Details 3) $ in Millions	Jun. 30, 2021 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining performance obligations	$ 15.0
Remaining performance obligation, expected timing of satisfaction, start date: 2021-04-01
Remaining performance obligation, expected timing of satisfaction
Remaining performance obligations, expected timing of satisfaction period	2 years

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Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Numerator:
Net income (loss)	$ 11,166	$ (9,140)	$ 8,553	$ (15,679)
Denominator:
Weighted-average common shares outstanding, basic (in shares)	112,144	113,572	112,177	113,240
Effect of potential dilutive common shares	2,787	0	3,181	0
Weighted-average common shares outstanding, diluted (in shares)	114,931	113,572	115,358	113,240
Earnings per share, basic	$ 0.10	$ (0.08)	$ 0.08	$ (0.14)
Earnings per share, diluted	$ 0.10	$ (0.08)	$ 0.07	$ (0.14)

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Earnings (Loss) Per Share (Details 2) - shares shares in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020
Earnings Per Share [Abstract]
Anti-dilutive shares excluded from calculation of earnings per share	1.7	2.1

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Earnings (Loss) Per Share (Details 3) - 1.375% Convertible senior notes due 2023 - Convertible senior notes shares in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2021 $ / shares shares	Jun. 30, 2021 $ / shares shares
Dilutive shares included in calculation of earnings per share
Initial conversion price of notes (in dollars per share) | $ / shares	$ 18.93	$ 18.93
Dilutive shares included in calculation of earnings per share	0.5	0.5
Potential cumulative common shares attributable to dilutive effect of conversion of convertible notes payable	9.1	9.1

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Intangible Assets and Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2021 USD ($)
Goodwill
Beginning balance	$ 183,222
Adjustment to goodwill	0
Ending balance	$ 183,222

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Intangible Assets and Goodwill (Details 2) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Goodwill
Gross carrying amount	$ 204,992
Accumulated impairment losses	(21,770)
Net carrying amount	$ 183,222	$ 183,222

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Intangible Assets and Goodwill (Details 3) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Components of intangible assets
Intangible assets, gross	$ 301,982	$ 301,982
Accumulated amortization	(274,779)	(265,495)
Intangible assets, net	27,203	36,487
In-process research and development
Components of intangible assets
In-process research and development		1,600
Existing technology
Components of intangible assets
Gross carrying amount	265,389	263,789
Accumulated amortization	(239,875)	(230,950)
Finite-lived intangible assets	$ 25,514	$ 32,839
Existing technology | Minimum
Components of intangible assets
Useful life (in years)	3 years	3 years
Existing technology | Maximum
Components of intangible assets
Useful life (in years)	10 years	10 years
Customer contracts and contractual relationships
Components of intangible assets
Gross carrying amount	$ 36,293	$ 36,293
Accumulated amortization	(34,604)	(34,245)
Finite-lived intangible assets	$ 1,689	$ 2,048
Customer contracts and contractual relationships | Minimum
Components of intangible assets
Useful life (in years)	6 months	6 months
Customer contracts and contractual relationships | Maximum
Components of intangible assets
Useful life (in years)	10 years	10 years
Non-compete agreements and trademarks
Components of intangible assets
Gross carrying amount	$ 300	$ 300
Accumulated amortization	(300)	(300)
Finite-lived intangible assets	$ 0	$ 0
Useful life (in years)	3 years	3 years

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Intangible Assets and Goodwill (Details 4) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible assets	$ 4,700	$ 4,600	$ 9,284	$ 9,276

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Intangible Assets and Goodwill (Details 5) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Estimated future amortization expense of intangible assets
2021 (remaining six months)	$ 5,540
2022	7,964
2023	7,260
2024	5,812
2025	520
Thereafter	107
Intangible assets, net	$ 27,203	$ 36,487

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Segment Information (Details) - Customer concentration risk - Accounts receivable	Jun. 30, 2021	Dec. 31, 2020
Customer 1
Concentration risk
Accounts receivable from major customer as a percentage of total accounts receivable	13.00%	13.00%
Customer 2
Concentration risk
Accounts receivable from major customer as a percentage of total accounts receivable	11.00%
Customer 3
Concentration risk
Accounts receivable from major customer as a percentage of total accounts receivable	10.00%	14.00%
Customer 4
Concentration risk
Accounts receivable from major customer as a percentage of total accounts receivable		11.00%

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Segment Information (Details 2) - Customer concentration risk - Revenue	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Customer A
Concentration risk
Revenue from major customer as a percentage of total revenue	16.00%	15.00%	19.00%	13.00%
Customer B
Concentration risk
Revenue from major customer as a percentage of total revenue		18.00%	11.00%	16.00%
Customer C
Concentration risk
Revenue from major customer as a percentage of total revenue	13.00%

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Segment Information (Details 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Major customer disclosure
Revenue	$ 84,859	$ 61,717	$ 155,241	$ 127,494
USA
Major customer disclosure
Revenue	45,541	32,014	91,692	66,802
Taiwan
Major customer disclosure
Revenue	9,018	3,752	17,861	10,816
South Korea
Major customer disclosure
Revenue	2,209	701	2,597	2,521
Japan
Major customer disclosure
Revenue	3,826	7,943	8,414	12,574
Europe
Major customer disclosure
Revenue	1,187	4,944	1,633	5,682
Canada
Major customer disclosure
Revenue	38	31	92	543
Singapore
Major customer disclosure
Revenue	14,330	8,802	20,668	16,432
Asia-Other
Major customer disclosure
Revenue	$ 8,710	$ 3,530	$ 12,284	$ 12,124

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Marketable Securities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Cash equivalents and marketable securities
Maximum maturity period of available-for-sale securities (in years)	3 years
Fair value	$ 291,644	$ 441,186
Amortized cost	291,787	441,244
Gross unrealized gains	13	64
Gross unrealized losses	(156)	(122)
Cash, cash equivalents and marketable securities
Cash, fair value	185,469	61,463
Cash, amortized cost	185,469	61,463
Fair value	477,113	502,649
Amortized cost	477,256	502,707
Gross unrealized gains	13	64
Gross unrealized losses	(156)	(122)
Money market funds
Cash equivalents and marketable securities
Fair value	19,262	18,162
Amortized cost	19,262	18,162
Gross unrealized gains	0	0
Gross unrealized losses	$ 0	$ 0
Weighted rate of return (as a percentage)	0.03%	0.01%
US Government bonds and notes
Cash equivalents and marketable securities
Fair value	$ 64,103	$ 169,633
Amortized cost	64,118	169,670
Gross unrealized gains	1	3
Gross unrealized losses	$ (16)	$ (40)
Weighted rate of return (as a percentage)	0.08%	0.12%
Corporate notes, bonds and commercial paper
Cash equivalents and marketable securities
Fair value	$ 208,279	$ 253,391
Amortized cost	208,407	253,412
Gross unrealized gains	12	61
Gross unrealized losses	$ (140)	$ (82)
Weighted rate of return (as a percentage)	0.20%	0.20%

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Marketable Securities (Details 2) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Debt securities, available-for-sale
Fair value	$ 291,644	$ 441,186
Fair value, cash	185,469	61,463
Fair value, cash, cash equivalents and marketable securities	477,113	502,649
Cash equivalents
Debt securities, available-for-sale
Fair value	19,262	67,504
Short-term marketable securities
Debt securities, available-for-sale
Fair value	$ 272,382	$ 373,682

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Marketable Securities (Details 3) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Debt securities, available-for-sale
Less than 12 months, fair value	$ 204,405	$ 251,897
Less than 12 months, gross unrealized loss	(156)	(122)
US Government bonds and notes
Debt securities, available-for-sale
Less than 12 months, fair value	54,628	70,548
Less than 12 months, gross unrealized loss	(16)	(40)
Corporate notes, bonds and commercial paper
Debt securities, available-for-sale
Less than 12 months, fair value	149,777	181,349
Less than 12 months, gross unrealized loss	$ (140)	$ (82)

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Marketable Securities (Details 4) $ in Thousands	Jun. 30, 2021 USD ($)
Contractual maturities
Contractual maturities, fair value, due less than one year	$ 196,592
Contractual maturities, fair value, due from one year through three years	75,790
Contractual maturities, fair value	$ 272,382

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Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	$ 291,644	$ 441,186
Money market funds
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	19,262	18,162
US Government bonds and notes
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	64,103	169,633
Corporate notes, bonds and commercial paper
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	208,279	253,391
Recurring basis
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	291,644	441,186
Recurring basis | Money market funds
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	19,262	18,162
Recurring basis | US Government bonds and notes
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	64,103	169,633
Recurring basis | Corporate notes, bonds and commercial paper
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	208,279	253,391
Recurring basis | Quoted market prices in active markets (Level 1)
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	19,262	18,162
Recurring basis | Quoted market prices in active markets (Level 1) | Money market funds
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	19,262	18,162
Recurring basis | Quoted market prices in active markets (Level 1) | US Government bonds and notes
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Quoted market prices in active markets (Level 1) | Corporate notes, bonds and commercial paper
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Significant other observable inputs (Level 2)
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	272,382	423,024
Recurring basis | Significant other observable inputs (Level 2) | Money market funds
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Significant other observable inputs (Level 2) | US Government bonds and notes
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	64,103	169,633
Recurring basis | Significant other observable inputs (Level 2) | Corporate notes, bonds and commercial paper
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	208,279	253,391
Recurring basis | Significant unobservable inputs (Level 3)
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Significant unobservable inputs (Level 3) | Money market funds
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Significant unobservable inputs (Level 3) | US Government bonds and notes
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	0	0
Recurring basis | Significant unobservable inputs (Level 3) | Corporate notes, bonds and commercial paper
Financial assets subject to fair value measurements and the necessary disclosures
Fair value, available-for-sale securities	$ 0	$ 0

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Fair Value of Financial Instruments (Details 2) - 1.375% Convertible senior notes due 2023 - Convertible senior notes - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Debt instrument
Face value	$ 172,500	$ 172,500
Carrying value	159,806	156,031
Fair value	$ 227,760	$ 194,709

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Fair Value of Financial Instruments (Details Textual) $ in Millions	Jun. 30, 2021 USD ($)
Equity security without readily determinable fair value
Equity method investment, ownership percentage	25.00%
Other assets
Equity security without readily determinable fair value
Equity method investment	$ 2.4

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Leases, Operating Lease Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Leases [Abstract]
2021 (remaining six months)	$ 4,330
2022	7,384
2023	4,573
2024	3,925
2025	4,043
Thereafter	21,325
Total minimum lease payments	45,580
Less: amount of lease payments representing interest	(7,754)
Present value of future minimum lease payments	37,826
Operating lease liabilities	6,722	$ 4,724
Long-term operating lease liabilities	$ 31,104	$ 34,305

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Leases, Additional Details (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Lessee, lease, description
Operating lease, weighted-average remaining lease term	8 years		8 years
Operating lease, weighted-average discount rate (as a percentage)	4.30%		4.30%
Operating lease costs	$ 1.9	$ 2.9	$ 3.7	$ 5.8
Operating lease payments			$ 4.3	$ 4.3
Minimum
Lessee, lease, description
Lessee, operating lease, remaining lease term	1 year		1 year
Maximum
Lessee, lease, description
Lessee, operating lease, remaining lease term	10 years		10 years

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Convertible Notes (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Debt instrument
Total long-term convertible notes	$ 159,806	$ 156,031
1.375% Convertible senior notes due 2023 | Convertible senior notes
Debt instrument
Face value	172,500	172,500
Unamortized discount	(11,896)	(15,420)
Unamortized debt issuance costs	(798)	(1,049)
Total convertible notes	159,806	156,031
Less current portion	0	0
Total long-term convertible notes	$ 159,806	$ 156,031

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Convertible Notes (Details 2) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Interest expense related to notes
Amortization of discount and debt issuance costs			$ 3,775	$ 3,571
Interest expense	$ 2,683	$ 2,580	5,297	5,135
Convertible senior notes | 1.375% Convertible senior notes due 2023
Interest expense related to notes
Coupon interest expense	593	593	1,186	1,186
Amortization of discount and debt issuance costs	1,901	1,798	3,775	3,571
Interest expense	$ 2,494	$ 2,391	$ 4,961	$ 4,757
Convertible notes, stated interest rate (as a percentage)	1.375%	1.375%	1.375%	1.375%
Effective interest rate of the liability component (as a percentage)	4.90%	4.90%	4.90%	4.90%

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Commitments and Contingencies (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2021 USD ($)
Contractual obligations
Remainder of 2021	$ 9,873	[1],[2]
2022	11,801	[1],[2]
2023	173,692	[1],[2]
2024	0	[1],[2]
2025	0	[1],[2]
Total contractual obligation	195,366	[1],[2]
Unrecognized tax benefit excluding foreign tax withholdings	27,200
Software licenses
Contractual obligations
Remainder of 2021	5,317	[1],[2],[3]
2022	6,429	[1],[2],[3]
2023	0	[1],[2],[3]
2024	0	[1],[2],[3]
2025	0	[1],[2],[3]
Total contractual obligation	$ 11,746	[1],[2],[3]
Terms of noncancellable license agreements, minimum (in years)	1 year
Acquisition retention bonuses
Contractual obligations
Remainder of 2021	$ 3,370	[1],[2],[4]
2022	3,000	[1],[2],[4]
2023	0	[1],[2],[4]
2024	0	[1],[2],[4]
2025	0	[1],[2],[4]
Total contractual obligation	6,370	[1],[2],[4]
Convertible notes
Contractual obligations
Remainder of 2021	0	[1],[2]
2022	0	[1],[2]
2023	172,500	[1],[2]
2024	0	[1],[2]
2025	0	[1],[2]
Total contractual obligation	172,500	[1],[2]
Interest payments related to convertible notes
Contractual obligations
Remainder of 2021	1,186	[1],[2]
2022	2,372	[1],[2]
2023	1,192	[1],[2]
2024	0	[1],[2]
2025	0	[1],[2]
Total contractual obligation	$ 4,750	[1],[2]

[1] For the Company’s lease commitments as of June 30, 2021, refer to Note 9, “Leases.”

[2] The above table does not reflect possible payments in connection with unrecognized tax benefits of approximately $27.2 million including $24.0 million recorded as a reduction of long-term deferred tax assets and $3.2 million in long-term income taxes payable as of June 30, 2021. As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time.

[3] The Company has commitments with various software vendors for agreements generally having terms longer than one year.

[4] In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment.

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Equity Incentive Plans and Stock-Based Compensation (Details) - shares		6 Months Ended
		Jun. 30, 2021
Stock compensation plan
Shares available for grant
Shares available, at the beginning of the year		12,412,320
Stock options forfeited (in shares)		51,477
Nonvested equity stock and stock units granted (in shares)	[1],[2]	(3,369,905)
Nonvested equity stock and stock units forfeited (in shares)	[2]	1,155,509
Shares available, at the end of the period		10,249,401
Conversion factor used to calculate the decrease in the number of shares available for grant resulting from the grant of restricted stock awards		1.5
Conversion factor used to calculate the increase in the number of shares available for grant resulting from the forfeiture of restricted stock awards		1.5
Potential additional performance stock units
Shares available for grant
Nonvested equity stock and stock units granted (in shares)	[1]	400,000

[1] Amount includes approximately 0.4 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2021 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below

[2] For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each restricted stock granted reduces the number of shares available for grant by 1.5 shares and each restricted stock forfeited increases shares available for grant by 1.5 shares.

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Equity Incentive Plans and Stock-Based Compensation (Details 2) - Options $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2021 USD ($) $ / shares shares
Number of shares
Outstanding, at the beginning of the period | shares	964,211
Options granted | shares	0
Options exercised | shares	(99,458)
Options forfeited | shares	(51,477)
Outstanding, at the end of the period | shares	813,276
Vested or expected to vest at the end of the period | shares	812,918
Options exercisable at the end of the period | shares	728,233
Weighted-average exercise price
Outstanding at the beginning of the period | $ / shares	$ 11.08
Options granted | $ / shares	0
Options exercised | $ / shares	11.29
Options forfeited | $ / shares	15.09
Outstanding at the end of the period | $ / shares	10.80
Vested or expected to vest at the end of the period | $ / shares	10.80
Options exercisable at the end of the period | $ / shares	$ 10.54
Weighted-average remaining contractual term (in years)
Outstanding	4 years 6 months
Vested or expected to vest	4 years 4 months 24 days
Options exercisable	4 years 1 month 6 days
Aggregate intrinsic value
Outstanding | $	$ 10,497
Vested or expected to vest | $	10,493
Options exercisable | $	$ 9,590

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Equity Incentive Plans and Stock-Based Compensation (Details 3) - Employee stock purchase plan - $ / shares	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Stock-Based Compensation
Expected stock price volatility rate	32.00%	46.00%
Risk free interest rate	0.04%	0.12%
Expected term	6 months	6 months
Weighted-average fair value of purchase rights granted under the purchase plan	$ 4.53	$ 3.50

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Equity Incentive Plans and Stock-Based Compensation (Details 4) - Nonvested equity stock units and stock units - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Nonvested equity stock and stock units
Nonvested at the beginning of the period (in shares)			4,851,265
Granted (in shares)	100,000	100,000	1,998,321	1,900,000
Vested (in shares)			(1,287,156)
Forfeited (in shares)			(585,690)
Nonvested at the end of the period (in shares)	4,976,740		4,976,740
Weighted-average grant-date fair value
Nonvested at the beginning of the period (in dollars per share)			$ 12.82
Granted (in dollars per share)			20.68
Vested (in dollars per share)			12.35
Forfeited (in dollars per share)			15.01
Nonvested at the end of the period (in dollars per share)	$ 15.84		$ 15.84

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Equity Incentive Plans and Stock-Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Employee stock purchase plan
Stock-based compensation
Employee stock purchase plan, shares issued during period			263,933	277,838
Employee stock purchase plan, weighted-average price per share			$ 11.58	$ 10.51
Shares available for issuance	2,900,000		2,900,000
Discount from market price specific date			15.00%
Stock-based compensation expense	$ 0.2	$ 0.2	$ 0.8	$ 0.7
Unrecognized compensation cost	0.4		$ 0.4
Unrecognized compensation cost, weighted-average period			4 months
Options
Stock-based compensation
Stock-based compensation expense	0.1	0.1	$ 0.2	0.3
Unrecognized compensation cost	0.7		$ 0.7
Unrecognized compensation cost, weighted-average period			1 year 7 months 6 days
Nonvested equity stock units and stock units
Stock-based compensation
Stock-based compensation expense	7.0	$ 6.3	$ 12.9	$ 11.8
Unrecognized compensation cost	$ 51.5		$ 51.5
Unrecognized compensation cost, weighted-average period			2 years 3 months 18 days
Awards, nonvested grants in period, shares	100,000	100,000	1,998,321	1,900,000
Awards, nonvested requisite service period			4 years
Awards, nonvested grants in period, fair value	$ 2.8	$ 1.7	$ 41.3	$ 29.3
Nonvested equity stock units and stock units | Director
Stock-based compensation
Awards, nonvested requisite service period			1 year
Nonvested equity stock units and stock units | Minimum
Stock-based compensation
Awards, vesting rights (as a percentage)			0.00%
Nonvested equity stock units and stock units | Maximum
Stock-based compensation
Awards, vesting rights (as a percentage)			200.00%

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Stockholders' Equity (Details) - 2020 Share repurchase program - shares	Jun. 30, 2021	Oct. 29, 2020
Class of stock
Total number of shares authorized to be repurchased under the program		20,000,000.0
Remaining number of shares authorized to be repurchased	13,400,000

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Stockholders' Equity (Details 2) - USD ($) $ in Thousands, shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Jun. 30, 2021
Accelerated share repurchases
Repurchase and retirement of common stock under repurchase program	$ 100,068		$ 100,068
2020 Accelerated share repurchase program
Accelerated share repurchases
Accelerated share repurchase program, upfront payment		$ 50,000
Repurchase and retirement of common stock under repurchase program, shares	(0.1)	(2.6)
Repurchase and retirement of common stock under repurchase program		$ (40,000)
Remaining initial payment, unsettled forward contract indexed to Company's stock		$ 10,000
2021 Accelerated share repurchase program
Accelerated share repurchases
Accelerated share repurchase program, upfront payment	$ 100,000
Repurchase and retirement of common stock under repurchase program, shares	(3.9)
Repurchase and retirement of common stock under repurchase program	$ (80,000)
Remaining initial payment, unsettled forward contract indexed to Company's stock	$ 20,000

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Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Tax Disclosure [Abstract]
Provision for (benefit from) income taxes	$ 2,631	$ 160	$ 2,128	$ 1,125
Income taxes paid	$ 5,000	$ 5,100	$ 10,500	$ 9,600

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Income Taxes (Details 2) $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($)
Research and development tax credit carryforward | State and local tax authority | California Franchise Tax Board
Valuation allowance
Valuation allowance, deferred tax asset, increase (decrease)	$ (0.7)

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Income Taxes (Details 3) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Valuation allowance
Unrecognized tax benefits	$ 144.7	$ 134.0
Portion of unrecognized tax benefits, which if recognized, would be recorded as an income tax benefit	3.2
Long-term deferred tax assets
Valuation allowance
Unrecognized tax benefits	24.0	23.6
Other assets | Foreign tax authority | National Tax Services
Valuation allowance
Unrecognized tax benefits	117.5	109.0
Long-term income taxes payable
Valuation allowance
Unrecognized tax benefits	$ 3.2	$ 1.9

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Restructuring Charges (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019
Restructuring and related cost, positions eliminated
Restructuring charges	$ 0	$ 0	$ 368	$ 836
2020 Restructuring plan
Restructuring and related cost, positions eliminated
Restructuring, number of positions eliminated					70
Restructuring charges			$ 400
2019 Restructuring plan
Restructuring and related cost, positions eliminated
Restructuring, number of positions eliminated						80
Restructuring charges					$ 800

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Subsequent Events (Details) - Subsequent event - USD ($) shares in Millions, $ in Millions	Aug. 31, 2021	Jul. 02, 2021
AnalogX, Inc.
Subsequent Events
Total consideration		$ 47.7
PLDA Group
Subsequent Events
Total consideration transferred	$ 60.0
Shares issued related to business acquisition (in shares)	0.3
PLDA Group | Maximum
Subsequent Events
Additional consideration subject to certain milestones, Year One (in shares)	0.3
Additional consideration subject to certain milestones, Year Two (in shares)	0.4
Additional consideration subject to certain milestones, Year Three (in shares)	0.5