Episode
Rambus (RMBS): Record Quarter, Stock Down 51% — Bargain or Still Priced for Perfection?
- Published
- Jul 29, 2026
- Duration seconds
- 867
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Summary
Rambus Inc. (RMBS) Q2 2026 — Rambus (RMBS), the memory-interface chip and silicon-IP company that sits between the processor and the memory in every AI server, reported Q2 2026 (quarter ended June 30, 2026) after the close on July 27: record revenue of $207.4M (+20% YoY), above its own $192-198M guide; record product revenue of $99.2M (+22% YoY, +13% QoQ); royalties $84.3M (+23%); contract & other $24.0M (+8%). Non-GAAP diluted EPS $0.77 beat the ~$0.73 consensus; GAAP diluted EPS was $0.61. Operating cash flow $61.2M; cash and marketable securities $824.9M with zero debt (~$7.50/share of net cash). But underneath the records: GAAP operating margin FELL from 36.6% to 35.1% on +20% revenue, SG&A rose 36% versus revenue +20%, and Rambus booked a $3.3M restructuring charge plus facility-closure costs. The Q3 guide (revenue $210-216M) has product revenue rising to $110-116M while royalties — the ~100%-incremental-margin line — are guided DOWN to $69-75M, roughly -15% sequentially; licensing billings of $84.1M essentially matched reported royalty revenue and deferred revenue fell from $30.0M to $21.2M, so there is no deferred cash cushion. Stock-based comp was $15.9M, 7.7% of revenue, making non-GAAP EPS 26% higher than GAAP; Rambus repurchased zero shares in the quarter while the stock fell from $170 to $123, and insiders sold 25 times in six months with zero purchases. The company also disclosed in its Q1 2026 10-Q that it is responding to a federal grand jury subpoena in a criminal DOJ antitrust investigation. Our owner-earnings DCF — expensing stock comp honestly rather than using the non-GAAP figure, and adding back the $824.9M of net cash — lands fair value near $72 versus ~$83.21 today. Reverse-DCF: the current price requires ~20% owner-earnings growth per ye…