RAMBUS (RMBS)·Q4 2025 Earnings Summary

Rambus Beats Q4 But Guides Down on Supply Chain Issue — Stock Falls 15%

February 2, 2026 · by Fintool AI Agent

Rambus delivered record Q4 2025 results with revenue of $190.2M (+18% YoY) and Non-GAAP EPS of $0.68 (+24% YoY), beating Street estimates on both metrics . Product revenue hit a quarterly record of $96.8M, up 32% YoY, driven by sustained leadership in DDR5 RCDs and a mid-40% market share in the DDR5 segment . Cash from operations also reached a record $99.8M .

Despite the beat, the stock fell approximately 15% in after-hours trading to ~$96.43. The culprit: a back-end manufacturing issue with an OSAT partner that was identified and resolved in Q4, but required quarantining and retesting inventory, impacting Q1 product revenue by "low double-digit millions" . Management emphasized the issue is fully resolved and expects strong growth to resume in Q2 .

Did Rambus Beat Earnings?

Yes — Rambus beat on both top and bottom line:

The company also exceeded its own Q4 guidance across key metrics:

What Happened With the Supply Chain?

This is the key story from the earnings call Q&A. CEO Luc Seraphin explained the supply chain issue in detail :

1. Root Cause: A back-end manufacturing issue was identified at one of Rambus's OSAT (outsourced semiconductor assembly and test) partners
2. Impact: Affected an "extremely low number of parts" but required extensive investigation
3. Response:
   • Identified root cause and implemented corrective actions
   • Pulled forward fresh material from Q1 inventory to meet Q4 customer demand
   • Quarantined all potentially impacted production material out of "abundance of caution"
   • Retesting quarantined material with enhanced screens
4. Q1 Impact: Approximately low double-digit million dollar revenue impact
5. Scope: Only affected older versions of RCD chips — companion chips (PMIC, etc.) were not impacted
6. Reputation: Management stated no reputational damage with customers — close collaboration on resolution

"The issue is being resolved in collaboration with our supply chain partners, and we expect our product business to return to strong growth in the second quarter. Fueled by market share gains and the continued ramp of new products, I am confident in our long-term trajectory for 2026 and beyond." — CEO Luc Seraphin

CFO Des Lynch confirmed inventory will be replenished by end of Q1, positioning Rambus to meet Q2 demand .

What Did Management Guide?

Q1 2026 guidance was the issue. While management struck a confident tone on long-term positioning, the near-term outlook implies sequential weakness:

The sequential decline in product revenue is notable given Rambus has delivered 5+ consecutive quarters of product revenue growth. Management guided operating costs of $100-104M (non-GAAP), a tax rate of 16%, and diluted shares of 110M .

How Did the Stock React?

RMBS closed at $113.71 on February 2. However, after-hours trading saw the stock fall sharply to approximately $96.43 — a decline of ~15.2% from the close.

The 52-week range is $40.12 - $135.75, meaning the stock remains up significantly from lows but has pulled back from recent highs. The selloff reflects investor concern about the supply chain disruption and Q1 outlook, despite management's assurances of a Q2 recovery.

What's the DDR5 Market Position?

Management provided detailed color on competitive positioning and product roadmap during the Q&A:

DDR5 RCD Market Share:

New Product Contribution:

• H1 2025: Low single-digit % of product revenue
• Q4 2025: Upper single-digit %
• Q1 2026: Expected double-digit % contribution
• PMIC (power management) is the largest new product contributor
• Customers value interoperability between RCD and PMIC chips

DDR5 Generation Mix (2026 Outlook):

• Gen 2: Was predominant in Q4, declining
• Gen 3: Growing, expected to be dominant in 2026
• Gen 4: Limited adoption (different core)
• Gen 5: Dependent on next-gen Intel/AMD platforms

MRDIMM Timing:

• Initial revenue contribution: Very end of 2026
• Main contribution: 2027
• Depends on Intel Diamond Rapids and AMD Venice platform rollouts

What Changed From Last Quarter?

Positives:

• Product revenue accelerated to +32% YoY (vs +19% in Q3 2025)
• DDR5 RCD market share reached mid-40s%, up from early 40s% in 2024
• Cash from operations reached a new record of $99.8M
• Full-year 2025 product revenue hit $347.8M, up 41% from 2024
• Balance sheet strengthened to $761.8M in cash and marketable securities
• New products now contributing upper single-digit % of product revenue
• Gross margins stable at 61.5%, within 60-65% long-term model

Concerns:

• Supply chain issue causes temporary Q1 disruption
• Q1 guidance implies sequential decline due to inventory rebuild
• Supply constraints in the memory market may limit growth in 2026
• Higher tax rate (16% vs 20% prior) impacting earnings

Quarterly Trend Analysis

Revenue has grown for 8 consecutive quarters. The key question is whether the Q1 guide represents typical seasonality or a more meaningful slowdown.

Key Management Quotes

CEO Luc Seraphin on record 2025 performance:

"2025 was an excellent year for Rambus. We closed with a strong Q4 and finished the full year with record revenue and earnings. Our financial success is a testament to both our strategy and execution as we continue to deliver products and technologies that accelerate memory, compute, and connectivity advancements in rapidly growing markets."

On the supply chain issue resolution:

"Quality management is really, really important. We had a real-life example here, where we identified an issue quickly. We had a very thorough quality process in place with our suppliers, with our customers, and we're back on track."

On server market demand and supply dynamics:

"The demand for servers is solid. There's a refresh cycle that is not over. There's also agentic AI and all the inference applications that drive demand. But what we hear from customers is they're gonna be constrained by supply... We see lengthening lead times."

On 2026 growth outlook:

"We expect to grow faster than market in 2026, despite the glitch we had in Q1... The product revenue for 2026 remains on track to grow faster than market."

Q&A Highlights

On the supply chain issue recovery (Kevin Cassidy, Rosenblatt):

• CFO confirmed the impact is "low double-digit million" dollars in Q1
• Inventory will be replenished by end of Q1
• Strong recovery expected in Q2 and full year

On server market growth (Aaron Rakers, Wells Fargo):

• Management uses Gartner's 8% server market growth as baseline
• Rambus expects to exceed this rate
• Demand solid, but supply constraints may be the limiting factor in 2026

On silicon IP business (Sebastien Naji, William Blair):

• IP portfolio well positioned for AI demand
• Focus on leading-edge solutions for HBM, GDDR, PCIe, and security
• Expected to continue growing in 2026

On gross margins (Aaron Rakers, Wells Fargo):

• FY 2025 gross margins at 61.5%, in line with 2024
• Operated in 61-63% range over last 3 years
• Expects to stay within 60-65% long-term model

Full Year 2025 Highlights

Balance Sheet Strength

Rambus ended Q4 with a strong balance sheet:

The company has no debt and generated $88.5M increase in cash and securities during Q4 alone .

Forward Catalysts

Near-Term (1-2 Quarters):

• Q2 product revenue rebound as supply chain normalizes
• New products reaching double-digit % contribution
• DDR5 Gen 3 becoming dominant mix

Medium-Term (2-4 Quarters):

• MRDIMM initial contribution expected late 2026
• Intel Diamond Rapids and AMD Venice platform launches
• Continued market share gains toward 50% target
• Silicon IP growth driven by custom AI chip demand

Risks:

• Memory supply constraints could limit upside in 2026
• Platform rollout timing dependent on Intel/AMD
• Higher tax rate (16% vs 20% prior) impacting earnings
• Customer concentration risk in data center market

Bottom Line

Rambus delivered a strong Q4 beat — record product revenue, record cash flow, and solid earnings growth. The issue is a supply chain disruption that will temporarily impact Q1, causing product revenue to decline sequentially by low double-digit millions. Critically, management emphasized the issue has been resolved and expects strong growth to resume in Q2 .

The 15% after-hours selloff reflects near-term concerns, but the structural thesis remains intact:

• Mid-40% DDR5 market share with room to grow toward 50%
• New products reaching double-digit contribution in Q1
• $762M in cash, no debt, and record cash flow generation
• Growing faster than market remains the 2026 expectation

The key question: Does the Q1 glitch reset expectations appropriately, creating a better entry point? Or does it signal deeper supply chain vulnerabilities? Management's detailed explanation and confident 2026 outlook suggest the former.

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For more on Rambus, explore the company page or read the full Q4 2025 earnings call transcript.