Rambus, Inc.

Welcome to the ROMBUS fourth quarter and fiscal year 2023 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 phone at any time. If anyone should require assistance during the conference, please press star 0 at any time. As a reminder, this conference call 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 fourth quarter and full year 2023 results conference call. I am Desmond Lynch, Chief Financial Officer at RAMBIS, and on the call with me today is Luke Serafin, 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 5pm Pacific time. Our discussions 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 supply chain shortages and other market challenges. 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 effect 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 insight 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 our 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. We finished the year strong with Q4 revenue and earnings at the high end of guidance and a robust $55 million in cash from operations. Through outstanding execution on our strategy, we delivered full year results that outpaced the overall semiconductor market in a very dynamic environment. Let me first take a moment to review our 2023 accomplishments. 2023 was the year of artificial intelligence, with generative AI bursting onto the scene and emerging as a strong catalyst for long-term secular growth. The increasing need for memory performance and capacity across the computing landscape, driven by the accelerating demand for data-intensive workloads, is a very positive trend for RAMBUS and one we expect to continue for many years to come. Over the course of the year, we realized a number of important milestones and achievements. The company further bolstered its long-term licensing foundation with the extension of the agreement with SK Hynix. We strengthened our balance sheet and returned value to our stockholders through share repurchase and debt retirement. We enhanced our focus on differentiated chips and digital IP for the data center with a strategic sale of the five business. And finally, as a testament to our success, Rambus was honored with GSA's most respected emerging semiconductor company award in our revenue category. Turning now to our businesses, Silicon IP continued to operate at scale, offering comprehensive security and interface IP solutions for multiple market segments. With our strengthened focus on differentiated digital solutions, we brought to market leading-edge HBM, GDDR, PCIe, and CXL controller IP, as well as state-of-the-art embedded security solutions, including post-quantum security, all of which are essential building blocks for future AI-centric data center architectures. In memory interface chips, we continue to execute well and gain share in a challenging environment. As the ecosystem redirected CapEx to AI servers, the market for traditional servers declined low double digits last year. And while DDR4 inventory digestion remained a headwind, we saw an acceleration of DDR5 adoption, which allowed us to maintain our revenue trajectory and to continue to gain share. In Q4, we delivered solid results with quarterly product revenue of $54 million. We were very pleased with our execution on DDR5, which was our predominant unit shipment for Q4 and for the year. We remained strategically focused on delivering DDR5 leadership products and announced the industry's first Gen 4 DDR5 RCD in December, to enable server-deemed operations at 7,200 megatransfers per second. Again, I am very pleased with the progress the team continued to make in 2023 while successfully navigating the market dynamics. As we turn to 2024, while we expect the softness in the traditional server market to persist into the first half of this year and DDR4 inventories to continue to recover slower than anticipated, We remain very positive on the longer-term outlook. We continue to work closely with our customers to re-establish DDR4 order and shipment patterns, and DDR5 continues to show solid momentum. We have multiple generations of our DDR5 solutions simultaneously progressing through different stages of the qualification and production life cycles to support the accelerated pace of computing platform rollouts. As I mentioned previously, we were the first to introduce a Gen4 RCD chip to the market, which is a great demonstration of our ongoing commitment to product leadership. We remain very well positioned and focused on execution as we actively work with customers and partners on the ongoing growth of DDR5. Additionally, we are very pleased with our progress on the development of our power management solutions. with our first PMIC sampling to customers and receiving positive feedback. We look forward to expanding our DDR5 chip portfolio later this year and to providing a complete memory interface companion chipset for the coming server module generations. As we look to 2024 and beyond, the importance of AI and other compute-intensive workloads will further accelerate the demands on computing and memory infrastructure. Continued advancement in DRAM capacity and bandwidth, as well as novel memory architectures, such as serial attached memory and multi-rank solutions, will be critical enablers to improve compute efficiency and performance across cloud enterprise and client systems. Through disciplined investment and close collaboration with the ecosystem, we have built a strong product roadmap that unlocks new levels of system performance and expands our industry leadership and market opportunity. In closing, Q4 was a strong quarter for the company that capped off a year of great execution and agility. While we navigate dynamic market conditions in the near term, our strategic focus on high-performance products for the data center and AI positions us well to drive the long-term profitable growth of the company and the consistent return of value to our stockholders. This is a very exciting time for the industry and for Ram Bus. And 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?