Rambus earnings rise as expected
By Bloomberg News
Special to CNET News.com
July 14, 1999, 4:30 p.m. PT
MOUNTAIN VIEW, California--Rambus, a designer of high-speed computer chips, said fiscal third-quarter earnings rose
18 percent as other companies prepare to ship chips based on Rambus technology.
Net income rose 18 percent to $2 million, or 8 cents a share for the quarter ended June 30, from
$1.7 million, or 7 cents, in the year-earlier period.
Rambus was expected to earn 6 cents, the average estimate of five analysts from First Call.
Revenue rose 16 percent to $10.6 million from $9.16 million.
The company licenses its high-speed technology to memory and microprocessor makers, who pay
the company royalties based on the amount of products sold. Intel, the No. 1 chipmaker, is
promoting Rambus's design for faster computers.
Though Rambus has been around for years, much of its future is staked on the use of its high-speed
memory technology in upcoming Intel-based computers scheduled to arrive in the fall.
Consequently, analysts expect Rambus revenue to pick up several months from now.
Intel has designated Rambus technology as the basis for high-end systems, but the relatively high
manufacturing and royalty costs have caused some reluctance within the industry.
"They are just paying the bills right now until the Intel royalties kick in," said Seth Dickson, a Warburg Dillon Read analyst, who
rates Rambus "strong buy."
Rambus reported earnings after the close of U.S. markets. Its shares rose 7.62 to 97.56.
News.com's Stephen Shankland contributed to this report.
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