Wednesday April 14, 4:10 pm Eastern Time
Company Press Release
Rambus Reports Results for the Second Fiscal Quarter
MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--April 14, 1999--Rambus Inc. (Nasdaq:RMBS - news) today reported financial results for the three and six month periods ended March 31, 1999. Second quarter revenues of $9.9 million were up 2% over the same period last year, and down 7% from the previous quarter. Revenues for the first six months of fiscal 1999 were $20.4 million, an increase of 7% over the same period in fiscal 1998.
Operating income for the second quarter was $1.6 million, compared to $2.2 million in the same period last year and $2.4 million in the previous quarter. For the six-month period, operating income decreased to $4.0 million from $4.4 million last year. Second quarter diluted earnings per share were $0.08 compared to $0.07 in the same period last year and $0.08 in the previous quarter. Diluted earnings per share for the first six months of fiscal 1999 were $0.16 compared to $0.14 for the same period in fiscal 1998. The Company's results for the second fiscal quarter of 1999 includes $713,000 in other income as a result of the gain on sale of an investment security.
With Intel now indicating a September launch of its Rambus-based chipset for use in PC main memory applications, the Company anticipates major volume shipments of Rambus ICs for the PC market will start in the December quarter with royalties from this source following in the March 2000 quarter. Since additional expenses to support this launch are still anticipated, the Company now expects its earnings to be no better than flat compared to second quarter results through the balance of calendar 1999.
The outlook for Rambus to become the next memory interface standard continues to be very bright. During the quarter, Rambus announced its mobile memory solution and Intel stated that it would provide chipset support for Rambus DRAMs in mobile platforms beginning in 2000. At the February Intel Developer Forum, the Intel materials showed Rambus being introduced for performance desktops later this year, for mobile PCs in 2000, and migrating through all segments of desktop and mobile PCs as well as workstations by the end of 2001.
In addition, in what may become one of the most significant design wins for Rambus aside from Intel, Sony announced the use of Rambus technology in its next-generation PlayStation II video game system scheduled to debut in Japan this winter and in the U.S. and Europe in autumn of 2000. Additional licensees of Rambus technology announced during the quarter included Winbond, as the fifteenth RDRAM licensee; Acer Labs, for PC chipsets; Hewlett-Packard; National Semiconductor, for integrated processors developed by its Cyrix subsidiary; and SwitchCore, for next-generation network switch products. Also, two major Taiwan foundries-TSMC and UMC-announced foundry services for Rambus chip customers.
Rambus Inc. designs, develops, licenses and markets high-speed chip-to-chip interface technology to enhance the performance and cost-effectiveness of consumer electronics, computer systems and other electronic systems. The Company licenses semiconductor companies to manufacture and sell memory and logic ICs incorporating Rambus interface technology and markets its solution to systems companies to encourage them to design Rambus interface technology into their products.
This release contains forward-looking statements regarding earnings for future periods. Actual results could differ materially. The factors which could cause actual results to differ materially include market acceptance of the Company's technology; systems companies' acceptance of Rambus ICs produced by the Company's licensees; market acceptance of the products of systems companies which have adopted the Company's technology; delays, lack of cost-competitiveness or other problems in the introduction or performance of Rambus ICs or products which include Rambus ICs including, but not limited to, the Intel Rambus-based chipset and the Sony PlayStation II; future dependence upon the PC main memory market and Intel; the loss of any strategic relationships with systems companies or licensees; announcements or introductions of new technologies or products by the Company or the Company's competitors; delays, lack of cost-competitiveness or other problems in the introduction or performance of enhancements or future generations of the Company's technology; fluctuations in the market price and demand for DRAMs and logic ICs into which the Company's technology has been incorporated; competitive pressures resulting in lower contract revenues or royalty rates; changes in the Company's and system companies' development schedules and levels of expenditure on research and development; personnel changes, particularly those involving engineering and technical personnel; costs associated with protecting the Company's intellectual property; changes in Company strategies; foreign exchange rate fluctuations or other changes in the international business climate; and general economic trends. A more detailed discussion of risks faced by the Company is set forth in the Company's 1998 Annual Report on Form 10-K filed with the SEC.
RAMBUS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Six Months Ended
March 31, Dec. 31, March 31, March 31,
1999 1998 1998 1999 1998
Revenues:
Contract revenues $ 7,945 $ 7,948 $ 7,122 $ 15,893 $ 13,798
Royalties 1,914 2,626 2,529 4,540 5,243
Total revenues 9,859 10,574 9,651 20,433 19,041
Costs and expenses:
Cost of contract
revenues 2,485 2,102 2,308 4,587 3,949
Research and
development 2,498 3,089 2,163 5,587 4,969
Marketing, general
& administrative 3,293 2,970 2,948 6,263 5,771
Total costs and
expenses 8,276 8,161 7,419 16,437 14,689
Operating income 1,583 2,413 2,232 3,996 4,352
Other income 1,657 1,012 755 2,669 1,226
Income before
income taxes 3,240 3,425 2,987 6,665 5,578
Provision for
income taxes 1,231 1,370 1,195 2,601 2,231
Net income $ 2,009 $ 2,055 $ 1,792 $ 4,064 $ 3,347
Net income
per share $ 0.09 $ 0.09 $ 0.08 $ 0.18 $ 0.15
Net income per
share-assuming
dilution $ 0.08 $ 0.08 $ 0.07 $ 0.16 $ 0.14
Shares used in per
share calculation:
Basic 23,209 23,034 22,654 23,121 22,560
Assuming dilution 24,980 24,874 24,316 24,933 24,313
RAMBUS INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, Dec. 31, Sept. 30,
1999 1998 1998
(unaudited) (unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 17,855 $ 31,900 $ 25,798
Marketable securities 65,584 54,431 53,913
Accounts receivable 2,004 2,033 1,913
Prepaids and other current assets 8,711 10,236 10,169
Total current assets 94,154 98,600 91,793
Property and equipment, net 4,650 3,788 3,989
Marketable securities, less
current portion 11,358 5,093 8,357
Investments 200 398 1,251
Other assets 5,643 5,576 5,597
Total assets $116,005 $113,455 $110,987
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and other
current liabilities $ 4,426 $ 3,191 $ 3,428
Current portion of capital
lease obligations 29 76 130
Current portion of
deferred revenue 26,031 27,519 28,617
Total current liabilities 30,486 30,786 32,175
Deferred revenue, less
current portion 35,138 35,845 37,020
Total liabilities 65,624 66,631 69,195
Stockholders' equity:
Common stock 23 23 23
Additional paid-in capital 72,035 70,446 67,617
Accumulated deficit (21,659) (23,668) (25,723)
Cumulative translation adjustment (18) 23 (125)
Total stockholders' equity 50,381 46,824 41,792
Total liabilities and
stockholders' equity $116,005 $113,455 $110,987
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