Rambus Reports Loss

Rambus Inc. (RMBS) - Snapshot Report reported third quarter 2009 net loss per share of 26 cents, exceeding the Zacks Consensus Estimate of net loss per share of 24 cents. 

Revenue 
The company reported revenue of $27.9 million, up 3.3% sequentially, but down 5.3% from the year-ago quarter. The sequential increase may be attributed to higher variable royalty revenue and the year-over-year decline to lower contract revenue. Slight Industry revival, coupled with growth in the company’s target markets helped the company increase revenue. 

Cost and Expense 
Total cost and expenses for the third quarter of 2009 was $48.5 million, down 19.2% from $60.0 million reported in the year-ago quarter. The company incurred restructuring cost of $4.0 million and asset impairment charges of $2.2 million in the third quarter of 2008, which increased the total cost in the year-ago quarter. This apart, the company witnessed year-over-year declines in R&D and SG&A expense of 5.5% and 4.5%, respectively. 

Operating Results 
The company reported an operating loss of $20.7 million in the third quarter (74.4% of revenue), compared to a loss of $30.6 million (104.1% of revenue) in the year-ago quarter. Although operating costs went down significantly, the decline was not sufficient for generating profit. 

Net loss for the third quarter was $27.5 million, or $0.26 per share, compared to a net loss of $24.0 million or $0.23 per share in the second quarter and $30.9 million or $0.29 per share in the year-ago quarter.
 
Balance Sheet
Cash, cash equivalent and marketable securities were $498.5 million at quarter-end, up $18.1 million from the previous quarter. During the recently concluded quarter, the company raised additional $22.5 million of aggregate 5.0% convertible senior notes due 2014. The convertible note balance at the end of the third quarter was $133.3 million. 

Guidance 
The company expects fourth quarter revenue to range between $26.0 million and $30.0 million. Operating expenses including stock based compensation are expected to be in the range of $50 million to $54 million, which includes an estimated litigation expense of $12 million to $15 million and stock based compensation of approximately $8 million.