Cash, cash equivalents, and marketable securities as of September 30, 2024 were $432.7 million, which remained flat from June 30, 2024, mainly due to $62.1 million in cash provided by operating activities, offset by $50 million paid in connection with a share repurchase program and $9.9 million paid to acquire property, plant and equipment.
2024 Fourth Quarter Outlook
The Company will discuss its full revenue guidance for the fourth quarter of 2024 during its upcoming conference call. The following table sets forth the fourth quarter outlook for other measures.
(In millions) |
GAAP |
|
Non-GAAP (1) |
Licensing billings (operational metric) (2) |
$57 - $63 |
|
$57 - $63 |
Product revenue (GAAP) |
$72 - $78 |
|
$72 - $78 |
Contract and other revenue (GAAP) |
$22 - $28 |
|
$22 - $28 |
Total operating costs and expenses |
$101 - $97 |
|
$86 - $82 |
Interest and other income (expense), net |
$4 |
|
$4 |
Diluted share count |
108 |
|
108 |
_________________________________________ |
||
(1) |
See “Reconciliation of GAAP Forward-Looking Estimates to Non-GAAP Forward-Looking Estimates” table included below. |
|
|
|
|
(2) |
Licensing billings is an operational metric that reflects amounts invoiced to our licensing customers during the period, as adjusted for certain differences relating to advanced payments for variable licensing agreements. |
|
For the fourth quarter of 2024, the Company expects licensing billings to be between $57 million and $63 million. The Company also expects royalty revenue to be between $54 million and $60 million, product revenue to be between $72 million and $78 million, and contract and other revenue to be between $22 million and $28 million. Revenue is not without risk and achieving revenue in this range will require that the Company sign customer agreements for various product sales and solutions licensing, among other matters.
The Company also expects operating costs and expenses to be between $101 million and $97 million. Additionally, the Company expects non-GAAP operating costs and expenses to be between $86 million and $82 million. These expectations also assume a tax rate of 22% and a diluted share count of 108 million, and exclude stock-based compensation expense of $13 million and amortization of acquired intangible assets of $2 million.
Conference Call
The Company’s management will discuss the results of the quarter during a conference call scheduled for 2:00 p.m. PT today. The call, audio and slides will be available online at investor.rambus.com and a replay will be available for the next week at the following numbers: (866) 813-9403 (domestic) or (+1) 929-458-6194 (international) with ID# 719712.
Non-GAAP Financial Information
In the commentary set forth above and in the financial statements included in this earnings release, the Company presents the following non-GAAP financial measures: cost of product revenue, operating expenses and interest and other income (expense), net. In computing each of these non-GAAP financial measures, the following items were considered as discussed below: stock-based compensation expense, acquisition-related/divestiture costs and retention bonus expense, amortization of acquired intangible assets, restructuring and other charges (benefits), expense on abandoned operating leases, facility restoration costs, gain on divestiture, change in fair value of earn-out liability, impairment of assets, and certain other one-time adjustments. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated. Management believes the non-GAAP financial measures are appropriate for both its own assessment of, and to show investors, how the Company’s performance compares to other periods. The non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. A reconciliation from GAAP to non-GAAP results is included in the financial statements contained in this release.
The Company’s non-GAAP financial measures reflect adjustments based on the following items:
Stock-based compensation expense. These expenses primarily relate to employee stock options, employee stock purchase plans, and employee non-vested equity stock and non-vested stock units. The Company excludes stock-based compensation expense from its non-GAAP measures primarily because such expenses are non-cash expenses that the Company does not believe are reflective of ongoing operating results. Additionally, given the fact that other companies may grant different amounts and types of equity awards and may use different option valuation assumptions, excluding stock-based compensation expense permits more accurate comparisons of the Company’s results with peer companies.
Acquisition-related/divestiture costs and retention bonus expense. These expenses include all direct costs of certain acquisitions, divestitures and the current periods’ portion of any retention bonus expense associated with the acquisitions. The Company excludes these expenses in order to provide better comparability between periods as they are related to acquisitions and divestitures and have no direct correlation to the Company’s operations.
