Revenue of $41.7 million, loss per share of $0.06 cents
LOS ALTOS, CALIFORNIA, UNITED STATES – 10/31/2007 – Rambus Inc. (NASDAQ:RMBS), one of the world’s premier technology licensing companies specializing in high-speed memory architectures, today reported financial results for the third quarter of 2007.
Revenues for the third quarter were $41.7 million, down 12.3% sequentially and down 9.2% over the third quarter of last year.
“We have come through a very challenging time for the Company with the restatement and the consequences of the stock options backdating investigation,” said Harold Hughes, president and chief executive officer at Rambus. “We look forward to being able to focus our attention on technology development and licensing activities.”
Total costs and expenses for the third quarter of 2007 were $58.2 million, which included $4.2 million of restatement and related legal expenses and $8.7 million of stock-based compensation as compared to total costs and expenses of $57.7 million for the second quarter of 2007, which included $7.5 million of restatement and related legal expenses and $10.3 million of stock-based compensation. The increased level of litigation activity during the current quarter caused non-restatement related litigation expenses to rise approximately $5.0 million over the previous quarter.
Total costs and expenses for the third quarter of 2006 were $71.7 million, which included $23.8 million of restatement and related legal expenses and $10.5 million of stock-based compensation.
Net loss for the third quarter of 2007 was $6.5 million as compared to a net loss of $2.7 million in the previous quarter and a net loss of $22.6 million in the third quarter last year. Diluted loss per share for the third quarter was $0.06 as compared to a loss of $0.03 for the previous quarter and a loss per share of $0.22 for the third quarter of 2006.
Cash, cash equivalents and marketable securities as of the end of the quarter were $445 million, up approximately $3.5 million from the second quarter of 2007 and up $24 million from the third quarter of 2006.
The conference call discussing third quarter results will be available live via the Rambus website (http://investor.rambus.com) at 2:00 p.m. Pacific Time today. The call will be webcast and can be accessed through the Rambus website. A replay will be available following the call on Rambus’ Investor Relations website or for one week at the following numbers: (888) 203-1112 (domestic) or (719) 457-0820 (international) with ID# 4789665.
| Condensed Consolidated Balance Sheets (In thousands) (Unaudited) |
||
| September 30, 2007 | December 31, 2006 | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 269,258 | $ 73,304 |
| Marketable securities | 175,733 | 351,055 |
| Accounts receivable | 2,167 | 846 |
| Unbilled receivables | 1,014 | 1,748 |
| Deferred and prepaid taxes | 11,703 | 11,388 |
| Prepaids and other current assets | 5,757 | 4,403 |
| Total current assets | 465,632 | 442,744 |
| Marketable securities, long-term | – | 11,982 |
| Restricted cash | 2,231 | 2,287 |
| Deferred taxes, long-term | 110,648 | 98,193 |
| Intangible assets, net | 14,764 | 18,697 |
| Property and equipment, net | 24,140 | 26,019 |
| Goodwill | 4,454 | 3,315 |
| Other assets | 3,084 | 1,380 |
| Total assets | $ 624,953 | $ 604,617 |
| Liabilities | ||
| Current liabilities: | ||
| Accounts payable | $ 14,258 | $ 10,429 |
| Accrued salaries and benefits | 9,564 | 12,788 |
| Accrued litigation expenses | 25,311 | 23,143 |
| Other accrued liabilities | 7,604 | 5,878 |
| Convertible notes | – | 160,000 |
| Deferred revenue | 5,510 | 6,003 |
| Income taxes payable | 433 | 197 |
| Total current liabilities | 62,680 | 218,438 |
| Convertible notes | 160,000 | – |
| Deferred revenue, less current portion | 19 | 1,554 |
| Long-term income taxes payable | 3,136 | – |
| Other long-term liabilities | 1,276 | 2,337 |
| Total liabilities | 227,111 | 222,329 |
| Stockholders’ Equity | ||
| Convertible preferred stock, $.001 par value: | ||
| Authorized: 5,000,000 shares | ||
| Issued and outstanding: no shares at September 30, 2007 and December 31, 2006 | ||
| Common stock, $.001 par value: | ||
| Authorized: 5,000,000 shares | ||
| Issued and outstanding: 103,820,383 shares at September 30, 2007 and December 31, 2006 | 104 | 104 |
| Additional paid-in capital | 577,856 | 550,210 |
| Accumulated deficit | (180,170) | (167,396) |
| Accumulated other comprehensive income (loss) | 52 | (630) |
| Total stockholders’ equity | 397,842 | 382,288 |
| Total liabilities and stockholders’ equity | $ 624,953 | $ 604,617 |
| Condensed Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited) |
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| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||
| 2007 | 2006 | 2007 | 2006 | |
| Revenue: | ||||
| Contract revenues | $ 6,388 | $ 4,422 | $ 21,145 | $ 17,381 |
| Royalties | 35,327 | 41,523 | 118,263 | 124,903 |
| Total revenues | 41,715 | 45,945 | 139,408 | 142,734 |
| Costs and expenses: | ||||
| Cost of contract revenues* | 5,781 | 6,121 | 18,878 | 23,010 |
| Research and development* | 18,312 | 17,695 | 60,339 | 51,553 |
| Marketing, general and administrative* | 29,914 | 24,114 | 79,657 | 81,869 |
| Costs of restatement and related legal activities | 4,169 | 23,796 | 18,631 | 25,690 |
| Total costs and expenses | 58,176 | 71,726 | 177,505 | 182,122 |
| Operating loss | (16,461) | (25,781) | (38,097) | (39,388) |
| Interest and other income, net | 5,645 | 4,472 | 16,496 | 11,993 |
| Loss before income taxes | (10,816) | (21,309) | (21,601) | (27,395) |
| Provision for (benefit from) income taxes | (4,318) | (1,337) | (8,495) | (11,510) |
| Net loss | $ (6,498) | $ (22,646) | $ (13,106) | $ (15,885) |
| Net loss per share: | ||||
| Basic | $ (0.06) | $ (0.22) | $ (0.13) | $ (0.15) |
| Diluted | $ (0.06) | $ (0.22) | $ (0.13) | $ (0.15) |
| Weighted average shares used in per share calculations: | ||||
| Basic | 103,820 | 103,792 | 103,820 | 102,792 |
| Diluted | 103,820 | 103,792 | 103,820 | 102,792 |
| *Includes stock-based compensation: | ||||
| Cost of contract revenues | $ 1,333 | $ 1,844 | $ 4,069 | $ 6,350 |
| Research and development | $ 3,190 | $ 4,269 | $ 9,821 | $ 11,442 |
| Marketing, general and administrative | $ 4,138 | $ 4,366 | $ 14,512 | $ 13,045 |
