Rambus, Inc. Beats Q2 Estimates, but Shares Fall on Soft Guidance

Technology licensing expert Rambus crushed analyst targets in the second quarter, but shares fall after hours as revenue guidance disappointed.

Anders Bylund
Anders Bylund
Jul 21, 2014 at 5:14PM
Technology and Telecom

Source: Rambus.

Technology licensing specialist Rambus (NASDAQ:RMBS) just reported results for the second quarter of 2014. In after-hours trading, Rambus shares fell as much as 4% on the news.

In the second quarter, Rambus saw revenue jump 32% year over year but fall 2% from first-quarter levels, landing at $76.5 million. On the bottom line, adjusted earnings nearly quadrupled over the year-ago period and fell 4% compared with the first quarter, stopping at $0.16 per diluted share.

Rambus signed several large licensing agreements in 2013, throwing year-over-year comparisons off kilter and making sequential contrasts more useful.

Wall Street analysts were expecting earnings of $0.05 per share on sales around $76 million. Rambus crushed the earnings consensus and edged past the Street's revenue projections.

Looking ahead, management set up a guidance range for third-quarter revenue between $68 million and $73 million. Current analyst views point to the very top of that range, while the new guidance midpoint fell 3% below the prevailing Street view.

During this quarter, Rambus paid $172.5 million to close a tranche of 5% convertible debt notes, as these notes reached maturation. The company is left managing $112.3 million in long-term debt instruments. As a result of the debt payment, the balance of cash equivalents and marketable securities dropped 36% year over year and now stands at $247 million.