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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: Cirruslvr who wrote (23846)	6/29/1999 4:51:00 AM
From: unclewest	Read Replies (3) \| Respond to of 93625

>>Can anyone explain or post a link to an article which describes how and how much % of the sale of each RIMM RMBS expects to get from licensing DRDRAM?<< cirrus, i am not aware of an article. i was at a meeting in feb where the cfo, harmon, stated that royalties on drdram are 1-2%. royalties on everything else (logic or controller chips) are 2-5%. i have heard that 1.7% is the anticipated average for drams. imo it is important to understand these figures and how they relate to earnings. we have a tendency to only calculate pc dram income here on the thread. rambus only expects to get 35% of their royalties from pc's, another 15% from servers, and a full 50% from controller revenue. the controller sales at that time were projected to be 1/2 pc's but the royalties are higher so the revenues to rambus are the same from both. we expect the revenues from pc's alone to be huge. when i think about it only being 1/3 of the total the potential here is just awesome. the % royalty paid depends on several factors. they are the $ amount of the upfront licensing fee pre-paid. the sales volume and the type of product sold. here on this thread, we have now established or have strong reasons to believe that rambus enabled products are presently or shortly will be used in the following: pc's, laptops, workstations, high speed telephone equip., nintendo, sony playstation II, hdtv, copiers, and graphics chips. i expect many more design wins to be announced in the graphics area, in hd dvd, scanners and numerous other consumer electronic products. i am gathering these figures from meeting notes. it is important to note that there will be some added shares as time goes on. if you want to calculate the per share earnings you need a bit more info. presently rmbs has 23.3 million shares. intel has 1 million $10 warrants. intel's warrants are redeemable when 20% of their chipset shipments for 2 consecutive quarters contain rambus dram. the feeling is at that point rambus will be so wildly successful that when intel exercises, it will just be a footnote on a quarterly statement. for rambus this will just be a paperwork transaction not involving any cash. rambus issued another 400,000 warrants to assist various corporations during the ramp up. this seems reasonable to me. intel gave $500 million to micron and another $100 million to samsung a few months ago for the same reason. there are another 800,000 shares approved for employee bonuses. to my knowledge none of these have been issued yet. they are well deserved. unclewest