Rambus shares plunge on soft guidance

Rambus (NASDAQ: RMBS) dropped 20% after releasing mixed Q3 results and a lukewarm Q4 forecast, disappointing investors who expected stronger momentum amid rising semiconductor demand.

While the company projected sequential growth into Q4, its forward guidance did not fully convince the market that near-term profitability would accelerate.

Q3 performance and guidance

For the fourth quarter, Rambus expects:

Revenue: $184M–$190M (vs. consensus $181.8M)
Royalty revenue: $59M–$65M
Licensing billings: $60M–$66M
Product revenue: $94M–$100M
Non-GAAP operating income: $81M–$91M
Adjusted EPS: $0.64–$0.71 (vs. consensus $0.66)
Capex: around $10M

Despite topping analyst estimates for some metrics, the soft tone of guidance and rising cost outlook unsettled investors.

CFO commentary

CFO Desmond Lynch highlighted that operating costs are expected to range between $99M and $103M, indicating continued investment in R&D and product expansion initiatives.
The company emphasized it remains focused on licensing growth and expanding its memory interface and security IP portfolio.

Investor sentiment

Traders viewed the guidance as incrementally positive on revenue but neutral-to-negative on margins, leading to a sharp selloff.
Analysts noted that investors are likely looking for clearer signals of accelerating profitability before re-entering the stock.