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Rambus
(NASDAQ:RMBS)
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Rating:74Outperform
Price Target:
$101.00
▲(12.40% Upside)
Action:Reiterated
Date:10/27/26
The score is driven primarily by strong financial quality (high margins, strong free cash flow, and very low leverage) and a constructive earnings call with robust growth guidance and continued design-win momentum. Offsetting these positives, technical indicators show a clear downtrend with negative momentum, and valuation remains demanding with a high P/E and no dividend support.
Positive Factors
Strong revenue, margins and cash generation
Rambus has expanded revenue substantially while sustaining high margins and converting earnings into strong free cash flow. This combination supports continued research, product development, and shareholder returns, while demonstrating that the licensing and semiconductor businesses can generate meaningful cash at scale.
Negative Factors
Historical earnings volatility
Although recent profitability is strong, the uneven historical earnings record indicates that reported results can be affected by cyclicality or non-recurring items. This makes future earnings power less predictable and could complicate planning, forecasting, and assessment of sustainable margins across industry cycles.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong revenue, margins and cash generation
Rambus has expanded revenue substantially while sustaining high margins and converting earnings into strong free cash flow. This combination supports continued research, product development, and shareholder returns, while demonstrating that the licensing and semiconductor businesses can generate meaningful cash at scale.
Read all positive factors
Rambus Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue across different business segments, providing insight into which areas are driving growth and how diversified the company's income streams are.
Breaks down revenue across different business segments, providing insight into which areas are driving growth and how diversified the company's income streams are.
Data provided by:
The Fly
The FlyRambus (RMBS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.80B
Dividend YieldN/A
Average Volume (3M)2.33M
Price to Earnings (P/E)36.7
Beta (1Y)2.17
Revenue Growth17.17%
EPS Growth3.84%
CountryUS
Employees791
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)2.46
Shares Outstanding108,461,600
10 Day Avg. Volume1,860,399
30 Day Avg. Volume2,326,178
Financial Highlights & Ratios
PEG Ratio1.53
Price to Book (P/B)7.26
Price to Sales (P/S)13.99
P/FCF Ratio29.72
Enterprise Value/Market Cap1.41
Enterprise Value/Revenue17.33
Enterprise Value/Gross Profit21.90
Enterprise Value/Ebitda38.11
Forecast
1Y Price Target
$132.60Price Target Upside47.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)3.04
Revenue Forecast (FY)$828.90M
Rambus Business Overview & Revenue Model
Company Description
Rambus Inc. is a global provider of semiconductor solutions, operating across key regions including the United States, Taiwan, South Korea, Japan, Europe, Canada, Singapore, and China. Their product portfolio encompasses advanced DDR memory interf...
How the Company Makes Money
Rambus primarily makes money through (1) licensing its semiconductor IP and (2) selling semiconductor products, with revenue also including associated services and other IP-related income.
1) IP licensing and royalties: Rambus develops patented t...
Rambus Earnings Call Summary
Earnings Call Date:Oct 26, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Feb 08, 2027
Earnings Call Sentiment Positive
The call was strongly positive. Rambus reported record revenue, earnings, product revenue, and operating cash flow; delivered strong product and silicon IP momentum; completed a $100 million share repurchase; and provided robust fourth-quarter and full-year growth expectations. The main challenges were tighter supply, elevated supply-chain input costs, modest MRDIMM adoption, and a gradual ramp for SOCAMM2, but management stated that supply constraints had not affected Q3 or Q4 results and expressed confidence in demand growth into 2027.Positive Updates
Record Third-Quarter Financial Performance
Third-quarter revenue reached a record $218 million, up 22% year-over-year and 5% sequentially. Non-GAAP net income was $91.7 million, and non-GAAP earnings per share was $0.84, up 35% year-over-year and 10% sequentially. Cash flow from operations also reached a record $102 million.
Negative Updates
Supply Chain Lead Times Are Increasing
Rambus reported longer lead times on the supply side and said supply will remain tight into 2027. The company stated that it is using its balance sheet, inventory, and supplier coordination to manage the situation.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Third-Quarter Financial Performance
Third-quarter revenue reached a record $218 million, up 22% year-over-year and 5% sequentially. Non-GAAP net income was $91.7 million, and non-GAAP earnings per share was $0.84, up 35% year-over-year and 10% sequentially. Cash flow from operations also reached a record $102 million.
Read all positive updates
Company Guidance
For Q4, Rambus expects revenue to be between $227 million and $233 million, product revenue to be between $127 million and $133 million, royalties revenue to be between $68 million and $74 million, and contract and other revenue to be between $26 million and $32 million; at the midpoint, product revenue is expected to increase 34% year-over-year and 14% sequentially. Q4 non-GAAP total operating costs are expected to be between $124 million and $120 million, capital expenditures approximately $8 million, non-GAAP operating profit between a profit of $103 million and $113 million, interest and other income approximately $6.5 million, and, assuming a non-GAAP tax rate of 16% and 109 million diluted shares outstanding, non-GAAP earnings per share in the range from $0.84 to $0.92, representing at the midpoint growth of 30% year-over-year and 5% sequentially. The company expects another record quarter of product revenue in Q4, which it expects to grow more than 30% year-over-year; 2026 revenue is expected to grow approximately 18% over 2025, including product revenue growth of approximately 24%, and non-GAAP earnings per share to grow approximately 24% over 2025. It expects to return 40% to 50% of free cash flows to shareholders over time, product gross margin in the near term within 60% to 63%, a long-term target of 60% to 65%, 2026 product gross margin right in the middle of the 60% to 63% range, and its silicon IP business around $130 million, growing at 10% to 15%, more like growing towards the higher end of that range.Rambus Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
92
Very Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 796.11M | 707.63M | 556.62M | 461.12M | 454.79M | 328.30M |
| Gross Profit | 630.02M | 537.56M | 419.91M | 318.78M | 314.02M | 229.87M |
| EBITDA | 362.00M | 325.32M | 244.15M | 237.08M | 41.18M | 78.27M |
| Net Income | 265.87M | 230.46M | 179.82M | 333.90M | -14.31M | 18.33M |
Balance Sheet | ||||||
| Total Assets | 1.56B | 1.53B | 1.34B | 1.26B | 1.01B | 1.23B |
| Cash, Cash Equivalents and Short-Term Investments | 776.91M | 761.83M | 481.80M | 425.84M | 313.23M | 485.61M |
| Total Debt | 20.22M | 43.65M | 30.15M | 30.71M | 44.48M | 198.78M |
| Total Liabilities | 140.50M | 165.12M | 222.44M | 220.13M | 233.30M | 370.25M |
| Stockholders Equity | 1.42B | 1.36B | 1.12B | 1.04B | 779.30M | 862.40M |
Cash Flow | ||||||
| Free Cash Flow | 312.93M | 333.18M | 199.90M | 172.55M | 209.91M | 195.43M |
| Operating Cash Flow | 346.75M | 360.02M | 230.60M | 195.79M | 230.39M | 209.22M |
| Investing Cash Flow | -109.26M | -223.11M | -56.72M | -57.40M | 151.98M | -115.66M |
| Financing Cash Flow | -206.00M | -54.41M | -167.99M | -169.62M | -362.94M | -114.21M |
Rambus Technical Analysis
Negative
89.86
Price Trends
94.25
Negative
104.37
Negative
108.16
Negative
Market Momentum
-2.68
Positive
43.39
Neutral
21.12
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RMBS, the sentiment is Negative. The current price of 89.86 is below the 20-day moving average (MA) of 99.60, below the 50-day MA of 94.25, and below the 200-day MA of 108.16, indicating a bearish trend. The MACD of -2.68 indicates Positive momentum. The RSI at 43.39 is Neutral, neither overbought nor oversold. The STOCH value of 21.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RMBS.
Rambus Risk Analysis
Rambus disclosed 46 risk factors in its most recent earnings report. Rambus reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rambus Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $205.00B | 76.67 | 16.22% | 0.10% | 30.62% | ― | |
74 Outperform | $9.80B | 36.72 | 18.85% | ― | 17.17% | 3.84% | |
74 Outperform | $28.41B | 51.24 | 27.16% | ― | 165.11% | 301.97% | |
69 Neutral | $6.41B | 5.51 | 32.04% | 1.04% | 69.56% | 260.84% | |
69 Neutral | $45.02B | 119.59 | 25.24% | ― | 98.48% | 256.17% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
55 Neutral | $828.01M | -72.98 | -3.42% | ― | 8.82% | 2.60% |
* Technology Sector Average
RMBS
Rambus
90.32
-23.29
-20.50%
CEVA
Ceva
29.41
1.02
3.59%
MRVL
Marvell
233.78
145.22
163.98%
SIMO
Silicon Motion
189.18
87.60
86.24%
CRDO
Credo Technology Group Holding Ltd
151.15
-3.81
-2.46%
ALAB
Astera Labs, Inc.
259.51
89.23
52.40%
Rambus Corporate Events
Business Operations and StrategyStock Buyback
Rambus Announces $100 Million Accelerated Share Repurchase
Positive
Aug 5, 2026
On August 4, 2026, Rambus Inc. entered into an accelerated share repurchase agreement with Mizuho Markets Americas LLC, through its agent Mizuho Securities USA LLC, to buy back approximately $100 million of its common stock. The transaction forms ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.