Rambus, Inc.

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 touch tone phone at any time if he shall require assistance during the conference please press star 0 at any time as a reminder this is a conference call is being recorded i would now like to turn the conference over to desmond lynch chief financial officer May I begin your conference?

Thank you, Operator, and welcome to the RAMBIS second quarter 2024 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 and other market factors 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. In addition, 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. Luc 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 Luc to provide an overview of the quarter. Luc?

Thank you, Des, and good afternoon, everyone. At Rambus, we develop industry-leading products that move data faster and safer to address the advancing needs for the data center and AI. Through our extensive technology expertise in designing state-of-the-art memory subsystems and ongoing strategic investments in new products, we are expanding our market opportunity to drive long-term profitable growth. In Q2, we continued to execute well with product growth fueled by ongoing leadership in DDR5 RCDs, continued progress in the qualification of our high-end DDR5 server PIMX, and the introductions of our client clock driver chip and suite of PCIe 7 IP solutions. Strong growth in our quarterly product revenue drove overall results in line with expectations, and outstanding cash generation from operations of $70 million further strengthened our balance sheet. We remain confident in the long-term outlook for Data Center benefiting from both an uplift in traditional servers as well as the ongoing growth in AI. Memory interface chips grew 13% sequentially and delivered product revenue of $57 million at the high end of expectations, driven by strength in DDR5. And in Q3, we anticipate double-digit sequential and year-over-year product revenue growth, driven by our core RCD products, and early contributions from new products. While we continue to see modest shipments of DDR4, the industry has transitioned to DDR5 as the predominant memory solution, supporting the memory performance demands of AI and other advanced workloads. We are well positioned for the ongoing DDR5 product lifecycle. We have multiple generations of DDR5 RCDs progressing through different stages of qualification and production, to support the accelerated pace of new server platform rollouts. Our leading product position in DDR5 RCDs has delivered great value to our customers and laid the foundation for our complete DDR5 DIMM chipset. As I mentioned in my earlier remarks, we continue to leverage our strong balance sheet to support our strategic investments in new products to drive long-term growth. Last quarter, we introduced our family of DDR5 server PIMICs, including the industry's first extreme current server PIMIC. Power management ICs are a critical part of DDR5 memory modules and are required to deliver reliable power at lower device voltages with tighter tolerance ranges. We are pleased with the demonstrated performance and the positive customer reception of the RAMBUS PIMICs at the major DRAM vendors. We are seeing strong traction with qualifications in progress for multiple module types across our customers, high performance, high capacity applications. And we are making qualification shipments later this year with production ramping throughout 2025. Our server PMIC product family amplifies our market opportunity and establishes a jumping off point for a growing roadmap of future power management chips. Also, As AI expands from training to inference, increasing demands on performance will extend beyond servers to client systems and drive the need for new PIMX solutions tailored for emerging use cases and form factors. Beyond PIMX, as DDR5 speeds continue to rise, many additional technologies used in the data center will waterfall into products for the client space to achieve higher levels of memory performance. Leveraging our broad experience in server memory chips and technology, today we introduced our first product dedicated to the client market, the DDR5 client clock driver chip, or CKD. This new chip supports DDR5 PC memory modules running at speeds of 6400 and 7200 megatransfers per second. Similar to the RCD, The CKD is required to maintain the signal integrity of the clock at high speed. CKDs will be targeted for high-performance memory modules in next-generation notebook and desktop PCs. While the CKD will initially address a small portion of the market, it is an exciting milestone for the company as we continue to expand our roadmap of new products and branch out into the client space. Turning to Silicon IP, the demands of the data center fueled by AI continue to propel the accelerated development of complex purpose-built chips that require advanced interface and security IP solutions. And while quarter on quarter revenue may vary from our growth trajectory due to customer program timing or other short-term impacts, AI continues to drive long-term momentum across our IP business. In Q2, Our results were led by increased design wins in HBM and continued strength in our suite of PCIe high-speed interconnect cores at tier 1 AI chip suppliers and hyperscalers. As we see these purpose-built chips proliferate, the continuing trend towards heterogeneous computing architectures places more value on moving and securing data. With the introduction of our family of PCIe 7 IP solutions, We further expanded our IP offering for AI and are working with market leaders on their next generation designs. PCIe 7 is designed to handle the massive parallel computing needs of AI workloads and enable secure data transfers between nearly every advanced chip in AI and HPC systems, including processors, accelerators, and data processing units. When coupled with our ongoing investments in the industry's most advanced security IP portfolio, including quantum safe solutions, we are providing vital building blocks for the next wave of high-performance chip and system designs. As we look forward, demands on power, performance, and security will continue to accelerate, driven by generative AI and other data-intensive workloads. We remain strategically focused on the ongoing scaling of system memory bandwidth and capacity through novel memory, interconnect, and power management solutions. These will be critical to improving efficiency and performance in computing systems for the data center to client. We are continuing our leadership in core products along with new product introductions to unlock higher levels of system performance and security to expand our market opportunity. In closing, Q2 was a solid quarter for the company, driven by the strong performance from our chip business, and we look forward to further double-digit product growth in Q3. With continued leadership in DDR5 RCDs, growing momentum in PNICs, and the introduction of our CKD as part of our ongoing investment in new products, we are well positioned to capitalize on current and emerging market trends. And our strong cash generation enables us to continue investing in innovative products and to pursue strategic initiatives that drive the long-term growth of the company, while consistently delivering value to our stockholders. 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?