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    RMBS
    Earnings call· Mar 2026(Q1 FY26)

    RAMBUS Q1 FY26 earnings call RMBS

    Apr 27, 2026 Source

    Executive summary

    Rambus Q1 FY26 — Strong Product Revenue Growth and AI Portfolio Expansion

    Rambus delivered a strong Q1 FY26, meeting financial targets with robust product revenue growth driven by DDR5 RCD chips and expanding its portfolio to address accelerating AI demands. The company introduced new LPDDR-based server module solutions and advanced IP for AI accelerators and network security, reinforcing its position in heterogeneous computing. Despite ongoing back-end supply chain tightness, Rambus is strategically building inventory and expects continued sequential growth, leveraging its diversified business model to capitalize on data center and AI megatrends.

    Highlights

    5

    • Product revenue reached $88 million in Q1, up 15% year-over-year.

    • Cash, cash equivalents and marketable securities totaled $786 million, an increase of $24 million from Q4 2025.

    • Generated strong operating cash of $83 million in the quarter.

    • Silicon IP business is expected to grow 10% to 15% annually, driven by AI demand.

    • Maintained strong market share in DDR products, exiting 2025 at mid-40% share with no erosion signs for 2026.

    Concerns

    2

    • Back-end supply chain remains tight with long lead times, expected to continue into 2027.

    • Financial impact from the new LPDDR5X SOCAMM2 chipset will be minimal in 2026 due to small volumes and niche application.

    Guidance & targets

    20
    CategoryTargetConfidence
    Revenue
    $192 million and $198 million
    high materiality
    High
    Product revenue
    $95 million and $101 million
    high materiality
    High
    Product revenue sequential increase
    11%
    medium materiality
    High
    Royalty revenue
    $72 million and $78 million
    medium materiality
    High
    Licensing billings
    $76 million and $82 million
    medium materiality
    High
    Non-GAAP total operating costs
    $114 million and $110 million
    medium materiality
    High
    Capital expenditures
    approximately $14 million
    medium materiality
    High
    Non-GAAP operating results
    profit of $78 million and $88 million
    medium materiality
    High
    Interest income
    $7 million
    low materiality
    High
    Non-GAAP tax expenses
    $13.6 million and $15.2 million
    medium materiality
    High
    Diluted shares outstanding
    110 million
    low materiality
    High
    Non-GAAP earnings per share
    $0.65 and $0.73
    high materiality
    High
    Full-year 2026 revenue growth
    strong growth
    high materiality
    High
    Full-year 2026 revenue growth
    year-over-year revenue growth
    high materiality
    High
    Silicon IP business growth
    10% to 15% a year
    medium materiality
    Medium
    Patent licensing business
    stable at $200 million, $210 million
    medium materiality
    Medium
    MRDIMM ramp
    starting in 2027 in earnest
    high materiality
    Medium
    MRDIMM SAM
    $600 million
    high materiality
    Medium
    Gen 5 DDR products volume ramp
    bulk of the volume just like for MRDIMM is going to start in 2027
    high materiality
    Medium
    Product revenue from new chips
    mid-double-digit of product revenues
    medium materiality
    Medium

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Product Revenue
    Driven by continued strength in DDR5 products and ramping new project contributions.
    		$88 million15%——
    Royalty Revenue
    Part of the patent licensing business, which is stable at $200M-$210M annually.
    		$69.6 million———
    Contract and Other Revenue
    Consisting predominantly of silicon IP. A portion of silicon IP revenue is also reflected in royalty revenue and licensing billings.
    		$22.6 million———

    Operational metrics

    15
    Non-GAAP Net Income
    $69.3 million
    Q1 FY26

    Calculated using an assumed flat tax rate of 16% for non-GAAP pretax income.

    Cash and investments balance
    $786 millionup $24 million from Q4 2025
    Q1 FY26

    Total cash, cash equivalents and marketable securities.

    Operating cash
    $83 million
    Q1 FY26

    Strong operating cash generation.

    Taxes paid on equity vesting
    $38 million
    Q1 FY26

    Partially offset strong operating cash.

    Capital expenditures
    $17 million
    Q1 FY26

    Partially offset strong operating cash.

    Inventory balance increase
    $14 million
    Q1 FY26

    Strategic increase to support product revenue growth and manage potential supply chain constraints.

    Depreciation expense
    $8.5 million
    Q1 FY26

    First quarter depreciation expense.

    Non-GAAP total operating costs
    $104.6 million
    Q1 FY26

    Includes cost of goods sold.

    Operating expenses
    $69.9 millionup sequentially
    Q1 FY26

    Up sequentially due to seasonal payroll-related taxes in connection with equity vesting.

    Interest and other income
    $6.9 million
    Q1 FY26

    Interest and other income for the quarter.

    Non-GAAP tax rate
    16%
    Q1 FY26

    Assumed flat tax rate for non-GAAP pretax income.

    Product revenue from newer products
    low double-digit percent
    Q1 FY26

    Contribution from companion chips and other newer products.

    Server market growth
    low double-digit growthfaster this year than last year
    FY26

    Expected growth for the overall server market, which is a catalyst for Rambus.

    Product revenue growth
    close to 18%vs H1 FY25
    H1 FY26

    Growth rate for product revenue in the first half of the fiscal year compared to the prior year, despite Q1 issues.

    Product revenue from new chips
    mid-double-digit
    FY26

    Expected contribution of newer products (companion chips) to total product revenue by the end of the fiscal year.

    Industry KPIs

    6
    MetricValueDetails
    Lead timeslong
    Ai data center revenue—
    Design wins socket pipelinestrong customer traction
    Inventory channel inventoryincreased by $14 millionUSD
    Node platform ramp scheduleGen 2 to Gen 3 DDR5 transition
    End market segment revenue mixProduct revenue: $88M; Royalty revenue: $69.6M; Contract and other revenue: $22.6MUSD

    Product announcements

    3
    ProductTypeDetails
    Chipset for JEDEC-standard LPDDR5X SOCAMM2 moduleslaunch
    HBM4E controllerlaunch
    Network security engine for Ultra Ethernetlaunch

    Risks & headwinds

    3
    Supply chain tightening on the back endQ1 FY26, continuing into 2027

    Lead times are long, and there is tension on the back end. Expected to be tight going into 2027.

    Mitigation: Working with suppliers; strategically building inventory to ensure supply for customers and manage fast transitions between product generations.

    Timing of new platform launchesOngoing, affecting ramp into 2027

    The launch of new products (e.g., MRDIMM, Gen 5 DDR) is dependent on the timing of new platforms from Intel and AMD.

    Mitigation: Engaging with customers and ecosystem partners to help shape next-generation server modules.

    Minimal financial impact from new LPDDR5X SOCAMM2 chipsetFY26

    Financial impact in the short run this year is going to be very minimal due to small volumes.

    Mitigation: Considered a strategic stepping stone for future LPDDR-based server memory solutions, allowing engagement with AI players and development of next-generation LPDDR6 solutions.

    What to watch in Q2 FY26

    5

    Product Revenue Growth

    Q3 FY26 and beyond
    CurrentQ2 guided at 11% sequential increase
    TargetContinued sequential growth after Q2

    Why it matters

    Indicates successful resolution of prior OSAT issue and effective supply chain stabilization, crucial for overall revenue trajectory.

    We expect to deliver double-digit product revenue growth in the second quarter. We continue to see increasing customer adoption of new products and remain well positioned to support the ramp of next-generation platforms as they enter the market. ... we will continue to grow sequentially after that in an environment where our footprint continues to be very strong.

    Q&A highlights

    7

    Why is Q2 product revenue recovery measured despite strong demand, given prior OSAT issue?

    The OSAT issue from the prior quarter is resolved, and the supply chain is normalizing. The Q2 product revenue guidance of 11% sequential growth is on the expected trajectory. Demand remains strong, and the market is transitioning from Gen 2 to Gen 3 DDR5, where Rambus has a strong position.

    “the issue that we have talked about in the prior call is behind us. Everything has been resolved. And it's a question now for us to restabilize the supply chain, which we are doing, and we see a normalization of that supply chain.”

    asked by Kevin Garrigan · answered by Luc Seraphin

    2 min read5 chapters

    Detailed Narrative

    01

    AI and Data Center Market Trends

    Rambus is well-positioned to capitalize on megatrends in data center and AI, driven by accelerating AI adoption and expanding inference use cases. Workloads are becoming more persistent and memory-dependent, requiring complex, heterogeneous AI infrastructure. This trend increases demand for memory capacity, bandwidth, latency, and power efficiency, leading to new memory and connectivity architectures and expanding opportunities for Rambus' IP and solutions.

    02

    Product Portfolio Expansion for AI

    The company expanded its product portfolio with the introduction of a chipset for JEDEC-standard LPDDR5X SOCAMM2 modules, building on its signal and power integrity expertise. This chipset, including new voltage regulators and an SPD Hub, is the first offering in Rambus' LPDDR roadmap for server module solutions. They are also actively working on LPDDR6-based SOCAMM2 solutions, positioning for future AI platforms despite minimal short-term financial impact from current LPDDR5X volumes.

    03

    Silicon IP Momentum and Innovation

    Rambus saw strong customer traction in Q1 for its silicon IP business, with continued design wins at Tier 1 companies. The company expanded its memory IP portfolio by introducing the industry's fastest HBM4E controller, setting a new benchmark for AI accelerator memory throughput. Additionally, a new network security engine for Ultra Ethernet was launched to protect distributed AI clusters, strengthening Rambus' role as a critical enabler for next-generation compute and connectivity in AI infrastructure.

    04

    DDR5 Leadership and Next-Generation Ramps

    Rambus continues to demonstrate strong execution and leadership in its core DDR5 RCD chips, delivering 15% year-over-year product revenue growth. The market is transitioning from Gen 2 to Gen 3 DDR5, where Rambus has a strong footprint. The company anticipates initial volumes for Gen 5 DDR products this year, with the bulk of the ramp expected in 2027, alongside MRDIMM, both dependent on new platform launches from Intel and AMD.

    05

    Strategic Inventory Management and Supply Chain

    Rambus increased its inventory balance by $14 million in Q1 and plans to continue strategic inventory building in Q2. This strategy aims to support product revenue growth and mitigate potential supply chain constraints, particularly the tightening back-end supply chain with long lead times, which is expected to persist into 2027. The company confirmed that a prior OSAT issue is resolved, and the supply chain is normalizing.

    AI-generated summary of the company’s earnings call. Not investment advice.