Amortization expense. The Company incurs expenses for the amortization of intangible assets in connection with acquisitions. The Company excludes these items because these expenses are not reflective of ongoing operating results in the period incurred. These amounts arise from the Company’s prior acquisitions and have no direct correlation to the core operation of the Company’s business.
Costs of restatement and related legal activities. These expenses consist primarily of investigation, audit, legal and other professional fees related to the 2006-2007 stock option investigation and related litigation, as well as recoveries received from third parties. The Company excludes these costs and recoveries from its non-GAAP measures primarily because the Company believes that these non-recurring costs and recoveries have no direct correlation to the core operation of the Company’s business.
Non-cash interest expense. The Company incurs non-cash interest expense related to its convertible notes. The Company excludes non-cash interest expense related to its convertible notes to provide more accurate comparisons of the Company’s results with other peer companies and to more accurately reflect the Company’s on-going operations.
Income tax adjustments. For purposes of internal forecasting, planning and analyzing future periods that assumes net income from operations, the Company estimates a fixed, long-term projected tax rate of approximately 36 percent. Accordingly, the Company has applied the 36 percent tax rate to its non-GAAP financial results to assist the Company’s planning for future periods.
On occasion in the future, there may be other items, such as significant asset impairments, restructuring charges or significant gains or losses from contingencies that the Company may exclude if it believes that doing so is consistent with the goal of providing useful information to investors and management.
About Rambus Inc.:
Rambus is one of the world’s premier technology licensing companies. As a company of inventors, Rambus focuses on the development of technologies that enrich the end-user experience of electronic systems. Additional information is available at www.rambus.com.
Condensed Consolidated Balance Sheets
|Cash and cash equivalents||$||160,844||$||215,262|
|Prepaids and other current assets||10,101||10,898|
|Total current assets||305,634||527,927|
|Deferred taxes, long-term||7,190||2,974|
|Intangible assets, net||189,363||40,986|
|Property, plant and equipment, net||72,494||67,770|
|LIABILITIES, CONTINGENTLY REDEEMABLE COMMON STOCK & STOCKHOLDERS’ EQUITY|
|Accrued salaries and benefits||27,488||31,634|
|Accrued litigation expenses||9,830||4,060|
|Other accrued liabilities||10,132||11,683|
|Total current liabilities||66,329||55,811|
|Convertible notes, long-term||130,354||121,500|
|Long-term imputed financing obligation||36,386||27,899|
|Other long-term liabilities||13,440||9,679|
|Total long-term liabilities||180,180||159,078|
|Contingently redeemable common stock||—||113,500|
|Total stockholders’ equity||448,960||334,783|
|Total liabilities, contingently redeemable common stock and stockholders’ equity||$||695,469||$||663,172|
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
Three Months Ended
Nine Months Ended
|Operating costs and expenses:|
|Cost of revenue (1)||7,425||1,368||16,632||5,026|
|Research and development (1)||32,318||23,002||79,855||67,678|
|Marketing, general and administrative (1)||48,952||27,938||119,416||88,873|
|Costs of restatement and related legal activities||832||1,229||2,703||3,393|
|Gain from settlement||—||(10,300||)||(6,200||)||(116,500||)|
|Total operating costs and expenses||89,527||43,237||212,406||48,470|
|Operating income (loss)||10,736||(11,494||)||16,598||183,999|
|Interest income and other income (expense), net||(768||)||312||(2,197||)||1,053|
|Interest expense on convertible notes||(5,410||)||(4,953||)||(15,794||)||(14,709||)|
|Interest and other income (expense), net||(6,178||)||(4,641||)||(17,991||)||(13,656||)|
|Income (loss) before income taxes||4,558||(16,135||)||(1,393||)||170,343|
|Provision for income taxes||4,080||4,441||12,944||52,510|
|Net income (loss)||$||478||$||(20,576||)||$||(14,337||)||$||117,833|
|Net income (loss) per share:|
|Weighted average shares used in per share calculation|