Rambus, Inc.

Welcome to the RAMBUS first quarter fiscal year 23 earnings conference call. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question and answer session. If you would like to ask a question, you may press star 1 on your touchtone pad at any time. If anyone should require assistance during this conference, please press the star 0 on your touchtone pad at any time. As a reminder, this conference is being recorded. I would now like to turn the conference over to Desmond Lynch, Chief Financial Officer. You may begin your conference.

Thank you, Operator, and welcome to the RAMBIS first quarter 2023 results conference call. I am Desmond Lynch, Chief Financial Officer at RAMBIS, and on the call with me today is Luke Serifin, our CEO. The press release for the results that we will be discussing today has been filed with the SEC on Form 8K. A replay of this call will be available for the next week at 866-813-9403. In addition, we are simultaneously webcasting this call and along with the audio, we are webcasting slides that we will reference during portions of today's call. A replay of this call can be accessed on our website beginning today at 5 p.m. Pacific time. Our discussion today will contain forward-looking statements, including our expectations regarding projected financial results, financial prospects, market growth, demand for our solutions, the company's ability to effectively manage any supply chain shortages, and the effects of ASC 606 on reported revenue, amongst other items. These statements are subject to risks and uncertainties that may be discussed during this call and are more fully described in the documents we file with the SEC, including our 8Ks, 10Qs, and 10Ks. These forward-looking statements may differ materially from our actual results, and we are under no obligation to update these statements. In an effort to provide greater clarity in the financials, we are using both GAAP and non-GAAP financial presentations in both our press release and on this call. A reconciliation of these non-GAAP financials to the most directly comparable GAAP measures has been included in our press release, in our slide presentation, and on our website at rambus.com on the investor relations page under financial releases. We adopted ASC 606 in 2018 using the modified retrospective method, which did not restate prior periods, but rather ran the cumulative respect of the adoption through retained earnings as a beginning balance sheet adjustment. Any comparison between our results under ASC 606 and prior results under ASC 605 is not an accurate way to track the company's progress. We will continue to provide operational metrics such as licensing billings to give our investors better insights into our operational performance. The order of our call today will be as follows. Luke will start with an overview of the business, I will discuss the financial results, and then we will end with Q&A. I'll now turn the call over to Luke to provide an overview of the quarter. Luke?

Thank you, Des, and good afternoon, everyone. This was a strong start to the year for the company with Q1 revenue and earnings at the high end of guidance. We delivered $39 million in cash from operations and retired the last of our remaining debt, further strengthening our balance sheet. These results were driven by continued execution and achieved in the context of a challenging macroeconomic environment. In addition to our strong financial performance, We were very pleased to extend our strategic relationship with SK Hynix through the middle of 2034 with the early renewal of our comprehensive patent licensing agreement. Similar to our extension with Samsung announced in Q4, this agreement strengthens our foundation for ongoing investment in product and technology leadership across our portfolio, and is a great demonstration of the ongoing value of our innovations to the market. Turning to our business results, memory interface chips performed well, delivering Q1 product revenue of $64 million, up 33% year over year, despite the challenging market conditions. In the near term, We remain vigilant as we navigate through the dynamics of the industry transition to a new generation of memory. While DDR4 inventories remain high at some end customers, as reflected in our second quarter guidance, we are seeing initial orders come through for DDR5 with shipments starting towards the end of the quarter. We remain focused on execution and are actively working with our customers. We expect a stronger second half as inventories return to more normal levels and demand for DDR5 continues to ramp. As we have said previously, the server memory crossover to DDR5 is projected for the first half of 2024, and we expect our memory interface chip product mix to be lumpy during the transition period. Given our strong leadership position in DDR5 and improving market conditions in the second half, we believe we are well positioned for continued annual growth in 2023. As we look farther out, advancing the performance of data center memory will be critical to address the growing bandwidth and capacity requirements of generative AI and other advanced workloads. We are making good progress on the following generations of DDR5 with our Gen 2 RCD in qualification across the ecosystem and our Gen 3 RCD sampling to all of our customers and partners. In addition to DDR5, close collaboration and development with the ecosystem continues on CXL, and we are well aligned with the market needs and timing to support the roadmap of future server generations for years to come. Finally, in silicon IP, our recently announced GDDR6 interface, achieving a best in class data rate of 24 gigabit per second, is a great illustration of our continued technology leadership. It is the latest addition to our market leading portfolio, which also includes the industry's fastest HBM3 memory IP subsystem. With these memory solutions, Rambus addresses the needs of both AI training and inference with state-of-the-art offerings. We continue to lead in our areas of focus for both interface and security IP. And in spite of current challenging macro conditions, we remain confident in the long-term growth opportunities. In closing, this was a strong quarter for the company with results at a high end of guidance and the team executing well. While we navigate the dynamic market conditions in the near term, we continue to see strong secular trends and solid growth opportunities. This is a very exciting time for the industry with the broadening availability of generative AI applications like ChatGPT that have captured the public imagination. These are perfect examples of the advanced workloads that will drive accelerated growth in computing and the data center with the ever-increasing demand for data. And with memory bandwidth as a first order enabler, Rambus is well positioned to enable the state-of-the-art memory performance required by these advanced applications. With our strategic focus in data center, continued execution, and diverse portfolio of offerings, we have confidence in the strength of our strategy and ability to drive long-term profitable growth for the company. We are making the right focused investments to deliver differentiated, high quality products and innovations that address the critical performance bottlenecks between processing and memory. As always, I'd like to thank our customers, partners, and employees for their ongoing support. And with that, I turn the call over to Des to discuss the quarterly financial results. Des?