Rambus Posts Record Revenue of $218.3M as Product Sales Jump 22% and Q4 Guidance Climbs

Rambus (RMBS) reported record third-quarter revenue of $218.3 million after the close on Monday, up 22% from a year ago and above the top of its $210 million to $216 million guidance range. Non-GAAP earnings were $0.84 per diluted share and GAAP earnings were $0.69. Analysts had expected about $0.79 and $213 million, according to consensus estimates.

Third-quarter results

Product revenue rose 15% from the second quarter as well. By our calculation, total revenue beat the $213.2 million consensus by about $5 million, or 2.4%, and non-GAAP EPS beat by about $0.05. GAAP net income was $74.6 million, up from $48.4 million, and non-GAAP net income was $91.7 million. President and CEO Luc Seraphin said, "Rambus delivered record quarterly revenue and earnings that exceeded our guidance, with strong customer demand driving record product revenue and record cash from operations."

Margins and taxes

Gross margin slipped as product sales, which carry lower margins than royalties, grew faster. By our calculation, GAAP gross margin was 78.3% versus 79.5% a year ago. Lower taxes also helped GAAP earnings: the provision was $16.0 million on $90.5 million of pre-tax income, about 17.6%, against roughly 30.2% a year ago by our calculation. Operating expenses rose 11% to $87.3 million on a GAAP basis, with sales, general and administrative expense up from $29.2 million to $37.7 million.

Fourth-quarter guidance

Rambus said achieving its revenue range will require signing customer agreements for product sales and solutions licensing. It expects interest and other income of $6.5 million, a 17.5% GAAP tax rate and a 16% non-GAAP tax rate on 109 million diluted shares. By our calculation, the $230 million revenue midpoint is about 5% above the third quarter and the $0.88 non-GAAP EPS midpoint is about 5% higher. The product revenue midpoint of $130 million is up about 14%, while the royalties midpoint of $71 million is about 8% below the third quarter's $77.0 million. Seraphin said the company expects "an even stronger performance in Q4."

Cash, buybacks and inventory

Rambus generated a record $102.5 million of cash from operations. Cash, cash equivalents and marketable securities ended the quarter at $776.9 million, down $48.0 million from June 30 after $135.4 million of share repurchases and $11.2 million of capital expenditures. Inventories reached $87.2 million, nearly double the $44.1 million at the end of 2025 by our calculation, as product sales scale up.

New products for AI systems

Rambus said it expanded its offerings for next-generation AI systems, including a PMIC for LPDDR6 SOCAMM2 memory modules and data center-class Root of Trust security IP.

What it means for investors

Rambus is increasingly a product company: product revenue made up about 52% of third-quarter sales by our calculation, and the Q4 outlook leans on it while royalties are guided lower. That shift lifts growth but pressures gross margin, and the sharp rise in inventory means results now depend more on timing of customer demand. Cash generation and the $135 million buyback give the company room to keep investing.

Sources: Rambus Inc., third-quarter 2026 financial results (Oct. 26), available at investor.rambus.com. Consensus figures are analyst estimates, and the EPS comparison is on a non-GAAP basis. This is informational, not a recommendation to buy or sell.